Film Tax Relief: Eligible Expenditure: UK expenditure: Supply of goods
In order to determine the amount of Film Tax Relief (FTR) to which a film production company (FPC) is entitled it is necessary to determine the extent to which services and goods contributing to the film’s core expenditure are used or consumed in the United Kingdom (FPC50050).
Where an FPC incurs expenditure on props which are used in filming in the UK, it is relatively clear where those goods are used or consumed.
An FPC buys a car from overseas which has been specially adapted for use during principal photography. On the assumption that such modification means that the car has no further value after filming has been completed, it is not treated as capital expenditure. The contract between the FPC and the vehicle supplier is for a single supply of goods.
Because principal photography takes place in the UK, the car is used or consumed within the UK, irrespective of where it was bought or modified, and the expenditure on the car will be treated as UK expenditure, irrespective of where the supplier of the car is based.