What are the intended release or broadcast requirements for film tax relief under section 1196A of the Corporation Tax Act 2009?

A qualifying film must be intended for theatrical release in commercial cinemas to paying audiences, with the majority of expected earnings from cinema showings, or alternatively be a television programme intended for broadcast to the general public. A token cinema run generating most revenue from streaming would not qualify.

How is the intended release or broadcast condition assessed over time under section 1196A?

The condition is assessed at the end of each accounting period during which film-making activities occur. If met at that point, it is treated as satisfied for the whole period. If not met, it is treated as never met and cannot be satisfied in any future accounting period, creating a permanent one-way gate.

What happens to previously claimed film tax relief if the intended release condition later fails?

Relief properly claimed in an earlier accounting period when the intended release or broadcast condition was genuinely met is not disturbed by a subsequent failure. There is no clawback of earlier relief. Only the current and future periods are affected when the condition ceases to be satisfied.

Can a film qualify under section 1196A if most of its revenue comes from streaming rather than cinema?

No. A film is only treated as intended for theatrical release if the majority of its earnings are expected to come from cinema showings. If most revenue derives from streaming or home video, the theatrical release limb is not satisfied. The film would need to qualify as a television programme intended for broadcast instead.

Corporation Tax Act 2009 section 1196A

Intended release or broadcast

Section 1196A sets out the requirements a film must meet regarding its intended method of distribution in order to qualify for film tax relief.

A qualifying film must either be intended for theatrical release in cinemas or be a television programme intended for broadcast to the general public.
Theatrical release means exhibition in commercial cinemas to paying audiences, and a film is only treated as intended for theatrical release if the majority of its earnings are expected to come from cinema showings.
The intended release or broadcast condition is assessed at the end of each accounting period in which film-making activities take place — if met at that point it is treated as met for the whole period, but if not met it is treated as never met and cannot be satisfied in any future period.
Where the condition was genuinely met in an earlier accounting period, any relief already obtained for that period is not disturbed by a subsequent failure to meet the condition.

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