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HMRC internal manual

Television Production Company Manual

Taxation: profit/loss calculation: income - nature

S1216BB Corporation Tax Act 2009 (CTA 2009)

Where profits or losses of a television programme trade of a Television Production Company (TPC) (TPC20010) are within the rules in Part 15A CTA 2009, the income to be brought into account is all the receipts of the trade of making, or making and exploiting, the programme.

This means all the money received from generating income from the television programme in the widest sense, including, but not limited to:

  • receipts from the sale of the television programme, or rights in the programme,
  • royalties or other payments for the rights to use the programme or aspects of it (for example, characters or music),
  • payments for rights to produce games or other merchandise, and
  • receipts by way of a profit share agreement.

Television Tax Credits (TTCs) due or paid to the TPC in connection with a programme are not regarded as ‘income from the relevant programme’.

Loans and grants

Receipts such as grants may be income where they are unconditional contributions to the costs of the programme. Loans are not trade receipts and, as with any other trade, they are not counted as television income. It may not be obvious whether a receipt is a loan or not.

Television financing may involve bringing in money from a wide range of sources, and promising investors/contributors a contingent return on their money. Sometimes it may be difficult to decide the character of a receipt or loan. Some funders may impose standard terms but each receipt will have to be viewed on its own conditions.