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HMRC internal manual

Orchestra Tax Relief

Orchestra Tax Relief: qualifying concerts: minimum EEA expenditure

S1217RB Corporation Tax Act 2009

To be a qualifying concert or series for Orchestra Tax Relief (OTR) purposes at least 25% of the core expenditure (OPC60010) on the concert or series incurred by the Orchestral Production Company (OPC) must be European Economic Area (EEA) expenditure.

For a series the condition applies to the whole series and not to each individual concert within it.

Pre-completion periods

Whether a concert or series meets the 25% EEA expenditure condition cannot be determined until after the end of the completion period (the accounting period in which the company ceases to carry on the separate orchestral trade in respect of the production).

But tax returns for any earlier periods (pre-completion periods) can include claims to OTR based on an expectation that the condition will be met if they include a statement of planned core expenditure that is EEA expenditure and this indicates that on completion of the concert or series the EEA expenditure condition will be met.

Claims for pre-completion periods will be revisited and OTR claims revised if it turns out the final amount of core expenditure that is EEA expenditure is less than 25% but claims have been made as if the condition would be met.

Final statement of the core expenditure on the concert or series that is EEA expenditure

The tax return for the final accounting period must:

  • indicate that the concert or series has been completed or abandoned, and
  • include a final statement of the core expenditure on the concert or series that is EEA expenditure.

 

The final statement should include all core expenditure on the production by the OPC.  It should take account, as far as it is possible to estimate such amounts with reasonable certainty, of the amount of any deferred payments of core expenditure that is EEA expenditure that can be expected to be paid out in the future.