New Era for UK Independent Films: BFI Opens Applications for Enhanced Tax Credit

The British Film Institute has opened applications for the low-budget certification required to qualify for the Independent Film Tax Credit (IFTC)

While 1 April 2025 will mark the official start of being able to make a claim for the enhanced Audio-Visual Expenditure Credit (AVEC), 30 October 2024 is a landmark day for UK independent film. The British Film Institute (BFI) has opened applications for the low-budget certification required to qualify for the Independent Film Tax Credit (IFTC), answering key industry questions and setting the stage for a new funding landscape.

Announced in the Spring Budget, the enhanced IFTC offers an impressive headline tax credit rate of 53%, which translates to an effective rate of 31.8% an 11.4% increase over the previous AVEC rate. This tax credit is available for films with budgets up to £15 million, capped at £4.77 million.

However, during the 2024 London Film Festival, the BFI expanded eligibility to productions with budgets up to £23.5 million, though the maximum credit remains capped at £4.77 million.

Eligibility Requirements for IFTC:

To qualify for the enhanced tax credit, a production must meet at least one of the following:

• Have a UK director,
• Have a UK writer, or
• Be classified as an official co-production.

For projects with multiple directors or writers, BFI now requires a designated UK Lead Director or Lead Scriptwriter. Evidence for these roles may include:

• Contracts or agreements,
• Chain of title documents, and
• Contribution proof, showing the lead’s role is equal to or greater than that of others in the same role.

Lead UK creatives would be expected to have equal or higher salaries than other contributors and must be listed as the “Lead” in credits.

Application Process

Productions applying for low-budget certification must submit a low-budget accountant’s report with their interim and final applications.

An auditor must confirm:

1. Total expenditures are within the £23.5 million limit, and
2. The lead director or writer is a British citizen or UK resident.

Proof of British citizenship and residency can include a passport, birth certificate, naturalisation certificate, or citizenship registration certificate. Indefinite leave to remain or UK work visas may also qualify.

Additionally, the BFI has reached out to filmmakers who previously applied for an AVEC certificate, offering them the option to switch to the new low-budget certification. If you’ve already received an AVEC certificate, applications to switch must be submitted within six months of service availability.

30 October officially opens the door for UK independent films to access the much needed support, launching a new chapter for the industry.

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