Part 1 U.K. Income tax, capital gains tax and corporate taxes

Capital allowances and other reliefs for businesses U.K.

32 Transition from video games tax relief U.K.

(1) Schedule 2 to FA 2024 (expenditure credits for films, television programmes and video games) is amended as follows.

(2) After paragraph 24 insert—

Calculation of expenditure credit where company previously benefiting from video games tax relief

24A (1) Sub-paragraph (2) applies if—

(a) a company makes an election under section 1179B(1) of CTA 2009 in relation to a video game in its company tax return for an accounting period, and

(b) in an earlier accounting period, the company was entitled to, and claimed, special video games relief (within the meaning of section 1217E(1) of CTA 2009) in respect of that video game.

(2) Section 1179CA(1) of CTA 2009 (amount of expenditure credit) has effect as if for Step 2 there were substituted—

“a

“Step 2

Deduct from that total the sum of—

(a)

so much of that expenditure as was incurred in accounting periods before the opt-in period and that is not European expenditure (within the meaning of section 1217AE), and

(b)

so much of that expenditure as was incurred in the opt-in period or any later accounting period and that is not UK expenditure (see section 1179AB).””

(3) In paragraph 18 (opting into new regime during transitional period), in sub-paragraph (5)(b), for “24” substitute “24A”.

(4) The amendments made by this section have effect in relation to elections made under section 1179B(1) of CTA 2009 in relation to any opt-in period commencing on or after 26 November 2025.