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HMRC internal manual

Animation Production Company Manual

Eligible expenditure: UK expenditure

S1216AH, S1216CG Corporation Tax Act 2009

The amount of Television Tax Relief (TTR) to which a Television Production Company (TPC) is entitled in respect of an animation is determined by the amount of core expenditure (see APC50010) which is used or consumed in the UK.

UK expenditure is defined as:

‘…expenditure on goods or services that are used or consumed in the United Kingdom.’

The key test here is the location where goods or services are used or consumed. The nationality of the provider of the goods or services is irrelevant, as is their location.

In order to determine whether expenditure is UK expenditure, it is necessary to establish:

  • the nature of the specific goods or services in question, and
  • the place where the recipient uses or consumes those goods and services.

These issues are explored further at:

APC50070 UK expenditure: services not directly related to a single territory
APC50090 UK expenditure: post-production services
APC50100 UK expenditure: supply of goods
APC50110 Apportionments: ‘fair and reasonable’
APC50115 Leading actors and voice artists