Corporation Tax Act 2009 section 1214

The UK expenditure condition

Section 1214 sets out the UK expenditure condition that must be satisfied for a company to claim special film tax relief, including the requirements for interim and final accounting periods and the consequences of failing to meet the condition.

• A company claiming special film tax relief must state in its tax return the amount of planned UK core expenditure on the film and demonstrate that the UK expenditure condition is expected to be met on completion.
• During interim periods, if both requirements are satisfied, the company is treated as provisionally meeting the UK expenditure condition.
• If it becomes apparent before the film is completed that the UK expenditure condition will not be met, relief is lost for all periods and tax returns must be amended accordingly.
• Once the film is completed or abandoned, a final statement of UK expenditure must be included in the tax return; if the condition is not met at that point, relief is withdrawn for all periods.