Tax incentives offer up effective methods for filmmakers to stretch their budget further than it would otherwise go. While many countries contain grants and incentives for national productions, tax incentives are most often targeting international productions by offering rebates on a film’s budget spent in the country.
This of course benefits both parties: the filmmakers save a pretty penny while the country in question is blessed with an inflow of economic activity, from both the film production and the presence of the cast and crew within the said country, alongside international exposure eternalised on film.
This article will compile an array of worldwide tax rebates which should be on the radar of all film producers and production companies.
What is a Film Tax Rebate?
A film tax rebate works the same as rebates in personal or corporate taxation. That is, it is a tax refund. This places a portion of the total expenditure back into the pockets of the production team—essentially saving money.
However, it is important to highlight that such a rebate will almost always occur after the fact—meaning you will only receive the funds back after production ceases.
Film Production Tax Rebates Across the Globe
Belgium offers 40-45% tax credit to investors for qualifying expenses incurred during film production within the country. These are available to both European and International productions.
In order to qualify for this lofty tax-credit, the production must be a registered co-production or bilateral agreement with Belgium and have a budget of at least €250,000 to be spent within the nation.
Chechia offers 20% cash rebate on expenses for goods and services provided to the film production by residents of the country. But more importantly they offer a whopping 66% tax rebate on withholding tax paid in Czech Republic on above-the-line talent.
To obtain such an impressive rebate the production must pass a cultural a production text with minimum spends of US$594,300 for a feature-length production US$79,200 for a documentary, US$316,700 for an episode for TV or US$39,600 for an episode of animated series.
For international productions, France offers a 30% rebate for qualified expenditure alongside a 50% rebate for qualified expenditure on VFX and post-production.
Projects must pass a cultural test and shoot for a minimum of 5 days within the country’s territory. These rates account for expenditure between €250,000 (or 50% of the production budget) and €30 million within the country.
French funds also provide several subsidies which make it an incredibly attractive location for film production.
While Hungary has offered a generous tax rebate to film productions for decades, since 2018 the deal was sweetened even further by increasing the total rebate value to 30% (formerly 25%).
In order to obtain the rebate, the film and/or collaborating Hungarian film production company must be registered with the National Film Office (NFO). Furthermore, to qualify for the full rebate of 30%, at least 80% of costs throughout the production must have been incurred within Hungary’s tax system.
Offering up 25% cash rebate for qualifying expenditure, UK Film Tax Relief requires productions to pass a cultural test or qualify as an official co-production.
This rebate is executable on up 80% of qualifying expenditure. The UK also offers many regional funding options for film productions ranging from £3000 to £500,000.
Depending on where in Canada you aim to shoot, different tax rebates will come into force. The general number nationwide is 16% of federal tax credit for resident labour. In British Columbia this increases to 33% provided that budgets are greater than C$1 million for a feature film, or C$200,00 for episodes over 30 minutes.
The United States is one of the most complex countries to list, as subsidies and tax rebates are delegated at the state level—not nationally.
Generally speaking, tax credit varies between 20-30%, with a number of notable outliers both above and below these thresholds. States often also provide different tiers of rebate depending on a film’s budget, and percentage of expenditure spent within the country.
China’s ever growing film industry offers an incredible 40% cash rebate plus an additional 10% business tax rebate of qualifying production expenditures in the country’s Qingdao Region.
To qualify, productions must spend at least 50% of qualified expenditure at the Dalian Wanda Studios (located in Qingdao). These numbers are also capped between spending 30 million RMB and 120 million RMB.
Australia offers 16.5% tax rebate on large-budget film and television projects shot within the country. They also offer 30% tax rebate for post-production, digital and visual effects regardless of which nation the production was shot in.
This rebate is available to Australian or foreign resident companies with an Australian business number. The minimum spends are A$15 million for feature production, A$1 million per hour for series and A$500,000 for post-production.
An incredibly large proportion of countries around the globe offer up tantalising tax incentives to filmmakers. While we have only scratched the surface of the total tax incentives available worldwide, this list gives you an impression of the overall trends found across some of the most active countries in the film production business.
Regardless of which location suits your production, one thing is for sure: if you are producing works of moving image international tax rebates have the potential to push your budget further while giving you access to new locations, collaborators and film markets.