Are you elligible for Games Tax Relief?

Are you elligible for Games Tax Relief?

By Ella Romanos

November 17th 2015 at 11:08AM

Ella Romanos clarifies which developers can apply for the highly sought after tax credits

Games tax relief has already been of huge help to many UK game development studios. Taking advantage of games tax relief is relatively simple which is encouraging more and more studios to apply.

If your project is eligible for games tax relief, you may also able to access a loan against it to help cash flow your project(s). These loans are provided by companies such as Altara Games.

Every loan company works slightly differently in general, however:

  1. Loans can be applied for at any point from the very beginning of your project (before you have spent any money or started production), to when you submit your claim and are just waiting for the money to be paid to you. Therefore you can borrow the money for anything from a couple of months, to a year or more.
  2. You will be able to borrow a percentage of your total claim amount. At Altara Games, we will lend 85 per cent. So if you are claiming £100,000, we can lend you £85,000.
  3. The interest on the loan will be repayable with the loan repayment, as soon as you get the claim money from HMRC. 
  4. There will likely be a requirement to have an accountant verify your figures, either with an informal assessment or an official Accountants Opinion.
  5. You will have to provide general information about your company, such as your latest financial accounts.

So, what is it that you need to do to be in a position to apply for a loan?

1. Get your interim (or final) certificate from the BFI

It’s easy and free to apply. The certificate is based on the cultural test, which takes about 15 minutes to complete to check that your game meets the criteria. They will also want to understand about the game, the project plan and your budget. An interim certificate is available both before and during production; a final certificate is available after the game is completed.

More information is available on the BFI website

2. Work out how much and how often you will claim

In general, all your production costs that are within the UK or an EEA state will be subject to 20% tax relief, so you can get up to a fifth of your entire costs back. You also can claim as often as you want during production. Most people seem to be claiming yearly at the same time as doing their end of year accounts, so you should break down your entire project claim into the various claims you plan to make.

3. Get all (or most) of the funding in place for production

You need show that you will be able to spend the money you need to make your claims and repay your loan. If you don't have all of the funding for your game yet, that may still be ok (although you will need at least need a significant proportion of it) but you will need to show how you would repay the loan if you don't succeed in raising the rest of the money. Otherwise you should consider only applying for a loan against the funding you already have.

Once you have completed the three steps above you are ready to apply for a loan against games tax relief.

If you would like to speak to Altara Games about loans, please contact us at info@altaragames.com.