Video Games Tax Relief

Video games tax relief (VGTR) is a creative industry tax relief incentive (introduced in 2014) that supports UK game developers.

Tax Relief For The Video Games Industry

Video games tax relief (VGTR) is a creative industry tax relief incentive (introduced in 2014) that supports UK game developers.

This is done by offering them a tax rebate on their expenditure in designing, producing, and testing their new video games. This relief provides an increased reduction of expenditure for Corporation Tax relief.

The tax relief is worth up to 20% of the core production costs of a game and it applies to video games:

  • Where the minimum of 25% of the core expenditure on the game is incurred on goods and services provided from within the European Economic Area (EEA).
  • That are going to be sold to the public.

You can make, amend, or withdraw a claim for creative industry tax reliefs up to one year after the company’s filing date. 

What Costs Qualify for Video Games Tax Relief?

To qualify for Creative Industry Tax Relief, you must have spent money on qualifying costs that are listed below.

Designing the Game

Producing the Game

Testing the Game

Gaming Big-01

The Company

How do I Qualify For Tax Relief?

There are certain criteria that need to be met to ensure that a company is eligible to claim Creative Industry Tax Relief, which are:

Qualification Icons-23

Qualification 1

01

The company is responsible for pre-production, principal photography, post-production, and delivery of the completed programme. 

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Qualification 2

02

The company is actively engaged in planning and decision making throughout the course of the programme.

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Qualification 3

03

The company is responsible for directly negotiating contracts, and pays for rights, goods, and services for the programme.

What Doesn't Qualify?

  • Financing
  • Post-Release Maintenance
  • Marketing
  • Debugging
  • Original Concept Design
Green Jellyfish Creative Industries Tax Relief

Making A Claim

What Documentation Will I Need?

To make a claim, you will need to do this through the Company Tax system which means that the claim must be made in a Company Tax Return or an amendment to a Company Tax Return. This will require the following documents:

You may be eligible to receive up to 25% of your core expenditure for your animation programme as a cashback from the relief programme. 

An example would be that if your programme cost £100,000 to make, HMRC could reward you with a tax relief cheque for £25,000.

To find out more about Green jellyfish’s Creative Industry Tax Relief service for Video Games, contact us today.