UK film financiers have given a guarded welcome to UK Chancellor George Osborne’s announcement yesterday of a new scheme offering investors a 50% tax relief for investing in business start-ups.
Some are seeing the new scheme as a potential means of funding film development.
“The Chancellor’s announcement of a potential 50% Tax Relief on Seed EIS (SEIS) investment up to £100,000 from 5 April 2012 could be great news for film makers, albeit that the £150,000 limit on companies may only suit early Development phase (seed) funding. Furthermore, in 2012/13, investors who make capital gains and who invest in an SEIS will qualify for capital gains tax exemption, making it even more attractive to potential funders,” commented Dave Morrison, an EIS expert at Nyman Libson Paul.
“It could be interesting for development (funding for film),” agreed Christine Corner, a Partner in Grant Thornton’s media and entertainment group. “We would definitely welcome it.”
However, the bigger questions about EIS eligibility rules and how they will affect the film industry remain unresolved.
The industry is hoping for answers to some of these questions as soon as next week.