UK to boost animated film production with new tax relief

The measure is “about backing business to innovate and grow the UK economy"

By Priyanca Rajput 19 Jul 2023

UK to boost animated film production with new tax relief — Shaun the Sheep. Credit: Aardman

Animated film productions in the UK are set for a boost as the government publishes plans for increased tax relief.

The revised incentive will take effect from January 1, 2024.

The creative industry has grown at more than 1.5 times the rate of the wider economy over the past decade, making it an important sector for the chancellor’s plan to grow the economy.

The new tax changes announced yesterday (July 18) are expected to be worth £5m each year to business and come alongside the Audio-Visual Expenditure Credit which was uplifted at budget from 33.33% to 39%.

It also follows the Creative Industries Sector Vision published last month, which set a goal to grow the creative industries by an extra £50bn by 2030.

These changes form part of the government’s plan to get the economy growing and make the UK a desirable territory to start and grow a business.

Financial secretary to the Treasury, Victoria Atkins said: "We want the UK to be the best place to start and grow a business and while we have the lowest corporation tax rate in the G7, we are not complacent.

"The changes we are making are about backing business to innovate and grow the UK economy, creating good jobs across the country."

This measure is part of 23 tax announcements published as part of the government’s ‘Legislation Day’, where draft legislation for an upcoming Finance Bill is published, as well as technical tax documents and consultations mostly from measures announced at the Spring Budget.