Financiers respond to UK producers’ indie tax credit concerns: “It’s a vibrant, competitive landscape"

It was supposed to be the start of a more stable era for the UK’s independent producers. The Independent Film Tax Credit (IFTC) for films under £15m ($21m) became available in April 2025 to help UK producers more easily fund their films and hold onto rights, allowing them to build companies, develop slates and attract further investment to the sector.  

However, at Screen International’s Screen Summit in September 2025, an array of producers shared that the partial benefits of the tax credit were often being eroded by the fees charged by some private gap financiers on the loans they were selling to producers. “The tax credit is effectively a government bond,” suggested producer Andy Paterson, whose credits include The Railway Man. “[But some] people are making 15% to 20% cashflowing while producers are not getting paid.” 

Producers such asPaterson are discovering that, even with the new tax credit, it remains a struggle to close financing. Against such a backdrop, some producers believe financiers are taking undue advantage.

Naturally, financiers see it very differently.  

“The notion UK financiers charge 15% to 20% has no context to it whatsoever,” says Mariyah Dosani, director, media and entertainment financing at Calculus. “If you’re organised and have a finance plan, you should know there are financiers out there who charge a reasonable rate for a UK tax credit.” 

One of the main points financiers make is that because there are so many of them, producers can shop around for a better rate. Regular financiers of UK films include banks, primarily Coutts in the UK, France’s Coficiné and Canada’s Bank of Montreal; investment companies such as Calculus through its Alchemy fund; and private outfits including Head Gear Films, Media Finance Capital, Elevation Capital, HH5, Ashland Hill Media Finance and Align, which are all ready to discount the tax credit. They each have different rates and offer different packages. 

“It’s a vibrant, competitive landscape. From a producer’s point of view, that’s a good thing. Rates have, if anything, come down a bit,” suggests Marlon Vogelgesang, CEO of Media Finance Capital. 

Competitive rates  

The financiers insist the rates they offer are competitive and fair. “Head Gear Films is now the most cost-­effective private lender in the world,” claims Head Gear CEO Phil Hunt, implying the company’s rates are as competitive as UK indie producers will find anywhere. “There is no one that can beat us. On good quality tax credits like the UK, we are the same as bank pricing.” Hunt cites 7% or 8% as the typical figure charged for a tax credit loan. 

“Our rates that we are quoting are approximately 2.5% to 2.75% over base [rate] for a UK tax credit,” says John Glencross, CEO and co-founder of Calculus Capital, whose Alchemy fund aims to achieve a target net return of a relatively modest 3% per annum for its investors.  

Given the base rate is currently 3.75%, that means the loans to producers are being made at just under 7%. Glencross says if there is confidence in the producers and the project is backed by broadcasters or public funders, in certain cases, Calculus is prepared to cashflow the tax credit on films that do not have completion bonds. Other financiers are often wary of doing this. If producers are looking for equity and to borrow against pre-sales, they are going to be charged far more for their money — and that is what they would expect. 

But some producers claim financiers demand to be allowed to cashflow the tax credit, which is regarded as the safest part of the lending, as the price for advancing bridge loans, gap and equity. They offer blended rates, in which all borrowing — from the safest to the most risky — is packaged together. 

“Some people are making large sums of money, but they can’t do that just through lending only against the tax credit,” claims Peter La Terriere, joint managing director of completion bond company Film Finances. “The extra fees are normally being charged on the more risky parts of the investment when a producer has not pre-sold their film, and they need help to secure the financing.”  

Other financiers make the same point. “We know we are more expensive than banks but we are much more agile and responsive. We have the advantage of being private players,” says Geoffroy t’Serstevens, chief executive officer of fund and production company Align. He suggests Align charges interest rates of around 10% to 12% to cashflow the tax credit.  

Simon Williams, managing partner at Ashland Hill Media Finance, confirms his company can provide funding “secured solely against the tax credit”, as well as gap and pre-sales. He also insists the pricing reflects risk profile and that rates are “fair and in line with prevailing market conditions”. 

The financiers nearly all make one point:  “Proportionally speaking, the smaller your production, the worse off you will be in terms of the cost of borrowing,” in the words of one.

If a producer is trying to cash flow a tax credit on a lower-budget film, it will be a challenge because there is so little upside for the financier.  

“The problem for some producers is the legal costs are still the same. If they’re doing a £10m [$14m] or a £100,000 [$137,000] film, the fixed costs remain largely unchanged,” says Saskia Thomas, director of London-­based film-financing company Elevation Films. 

Lengthy processing 

One issue producers and financiers agree on is the length of time it takes the British Film Institute (BFI), which administers the credit, and the UK tax authority HMRC to process IFTC claims.

“Certification wait time is around 14 weeks. That’s just the time [BFI] takes to get to your film,” says one exasperated producer, of how the delays cost money and put business plans in jeopardy. “If you’re a £5m [$7m] feature and you have £1.5m [$2m] of tax credit that you borrowed against, that is 14 weeks paying interest on that sum. Once the BFI gives it a tick, it goes to HMRC who take a further six to eight weeks to process it. That means an additional three months of processing time when you’re paying interest.” 

While admitting to mostly Covid-caused delays in the past, the BFI says its part of the process is now taking around six weeks.

“The BFI has a target turnaround time of six weeks for applications for the cultural test, and in the current financial year [April 2025 - January 2026], almost 70% of applications have been completed within that timeframe,” confirmed a BFI spokesperson.

”When an application requires additional communication, i.e., due to missing information or requiring clarification, that timeline can extend and we state on our website that productions need to build in at least eight weeks into their schedules. In rare cases, application times can extend beyond eight weeks, but the Certification team is always responsive to enquiries.

“As well as adapting to the influx, the UK Government has also since committed funding to ensure the team is resourced to meet the demands of the production across the UK and the new IFTC.”

The HMRC did not respond to Screen’s request for comment.  

Alternatives 

Some producers are hopeful the government-­owned British Business Bank can step into the breach and cashflow the tax credit at a lower rate. But there is scepticism about how this would work in reality. It seems more likely the Bank will support companies rather than individual projects 

“Every producer knows that film production, especially indie film production, moves at a breakneck pace,” says one well-placed observer. “To assume government will be better at risk management and underwriting in this high-speciality sector is nuts. They’re never going to do it better, and it’s not going to be more efficient.” 

Everyone who spoke to Screen was quick to acknowledge the UK government’s “generosity” in setting up the indie tax relief. There is wariness about being critical of a measure that can potentially do so much good. Some financiers even argue it is time for producers to step up to the plate. 

“I don’t like to see them deferring fees but if that is the only way they can make the financing work, it’s their content at the end of the day,” says one observer. “They’re in control of it. They’ll need to try to make the film to recoup their fees. This is their business. Take ownership of it and don’t always rely on handouts.”

• “The bank has got more firepower now”: How the British Business Bank is stepping up support for UK independent film