Theatre, Orchestra, and Museums and Galleries Exhibition tax reliefs
Published 27 October 2021
© Crown copyright 2021
This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives.gov.uk.
Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned.
This publication is available at https://www.gov.uk/government/publications/theatre-orchestra-and-museums-and-galleries-exhibition-tax-reliefs/theatre-orchestra-and-museums-and-galleries-exhibition-tax-reliefs
Who is likely to be affected
Companies claiming tax relief for theatrical productions, orchestral concerts and museum and gallery exhibitions.
General description of the measure
Alongside the raising of the rates of relief of three Corporation Tax reliefs that are collectively referred to as the ‘cultural reliefs’: Theatre Tax Relief (TTR), Orchestra Tax Relief (OTR), and Museums and Galleries Exhibition Tax Relief (MGETR), the government is also taking the opportunity to clarify some of the relief rules, such as making it easier for touring museum and gallery exhibition production companies to claim relief for touring.
Policy objective
The aim of the cultural tax reliefs of TTR, OTR and MGETR is to increase the amount and quality of qualifying theatrical and orchestral productions and the development of creative new exhibitions.
Background to the measure
TTR was introduced by Finance Act 2014, with an effective date from 1 September 2014. OTR by Finance Act 2016, with an effective date from 1 April 2016, and MGETR by Finance Act (No. 2) 2017, with an effective date from 1 April 2017.
Detailed proposal
Operative date
The measure will have effect from 1 April 2022.
Current law
The current law is contained in Parts 15C, 15D and 15E of the Corporation Tax Act 2009. These Parts set out the rules for the tax relief of theatre, orchestra and museum and gallery exhibition production companies’ qualifying productions, concerts and exhibitions. These rules allow eligible companies engaged in the production of qualifying theatrical productions, orchestral concerts, and museum and gallery exhibitions to claim an additional deduction, and where that additional deduction results in a loss, to surrender those losses for a payable tax credit.
Part 15C sets out provisions for tax relief for production companies in respect of their theatrical productions.
Part 15D outlines provisions for the production of orchestral concerts and applies for Corporation Tax purposes.
Part 15E includes provisions for the MGETR.
Proposed revisions
Legislation will be introduced in Finance Bill 2021-22 to amend Parts 15C, 15D and 15E of the Corporation Tax Act 2009, to better target the cultural reliefs and ensure that they continue to be safeguarded from abuse.
Summary of impacts
Exchequer impact (£m)
| 2021 to 2022 | 2022 to 2023 | 2023 to 2024 | 2024 to 2025 | 2025 to 2026 | 2026 to 2027 |
|---|---|---|---|---|---|
| — | negligible | negligible | negligible | negligible | negligible |
This measure is expected to have a negligible impact on the Exchequer.
Economic impact
This measure is not expected to have any significant economic impacts.
The terms used in this section are defined in line with the Office for Budget Responsibility’s indirect effects process. This will apply where, for example, a measure affects inflation or growth. You can request further details regarding this measure at the email address listed below.
Impact on individuals, households and families
There is no impact on individuals as this measure only affects businesses. This measure is not expected to impact on family formation, stability or breakdown.
Equalities impacts
This measure is not expected to have an impact on people with protected characteristics.
Impact on business including civil society organisations
This measure is expected to have a positive impact on those museums and galleries who tour, and also makes it easier for businesses to understand what can be claimed. This measure is expected to have a negligible impact on the costs for businesses. Some businesses will be able to claim at a higher rate of relief. One-off costs will include familiarisation with the change and could include updating software or internal systems to reflect the new rate of relief. There are not expected to be any continuing costs.
Customer experience is expected to remain broadly the same as this measure does not alter how businesses interact with HMRC. This measure is not expected to impact civil society organisations.
Operational impact (£m) (HMRC or other)
Any operational impact is expected to be negligible.
Other impacts
Other impacts have been considered and none have been identified.
Monitoring and evaluation
The measure will be kept under review through communication with affected taxpayer groups. HMRC will monitor this measure through the analysis of claims data and the publication of summary statistics. An external review of the MGETR was launched in 2020 and the results of the evaluation are due for publication in 2022.
If you have any questions about this change, please contact Kerry Pope on Telephone: 03000 585740 or email: kerry.pope@hmrc.gov.uk, or Stephanie Martinez on Telephone: 03000 519492 or email: stephanie.martinez@hmrc.gov.uk.