Production coin is available from the U.K. Film Council (via its Premiere and New Cinema funds) and from a variety of regional agencies, including Scottish Screen, Film Wales, the Welsh Creative IP Fund, the Northern Ireland Film & TV Commission, Screen Yorkshire, EM Media and the Isle of Man Film Commission. Each has its own mixture of industrial and cultural criteria for awarding money.
The U.K.’s new production tax credit came into force in April to replace the old Section 42/Section 48 tax relief programs, which underpinned sale-and-leaseback deals. The new system has one dramatic difference from the old one: It only pays out for work done in Blighty.
So an American producer can shoot a studio movie at Pinewood and get the tax credit on all of that expenditure (including the fees for Hollywood stars). But a British producer who takes a British cast and crew to Kenya (think “The Constant Gardener”) will get nothing.
The value of the credit is calculated by a complex formula, but basically films costing up to £20 million ($38 million) will get back 20% of their budget, and films that cost more will see 16% returned. For co-productions, these percentages apply only to the proportion of the budget attributable to the British co-producer.
Films have to pass a new British cultural test to qualify, but shooting in the U.K. and using a reasonable amount of local talent should be enough to meet the requirements.
One drawback is that the credit is paid upon completion, so producers will need to find someone willing to advance the coin against the value of the credit on a discounted basis.
- U.K. Film Council: Web: ukfilmcouncil.org.uk; Email: email@example.com; Contacts: Sally Caplan and Lenny Crooks, respective heads of U.K. Film Council’s Premiere and New Cinema funds
- Brighthaven (cash flow finance for tax credit): Contact: Richard Holmes (firstname.lastname@example.org)
- Abacus (tax credit cash flow): Web: zephyr films.co.uk; Contact: Chris Curling (ccurling@ zephyrfilms.co.uk)
Directed by Gillian Armstrong and starring Guy Pearce and Catherine Zeta-Jones, the Houdini biopic “Death-Defying Acts,” which started shooting in August, is one of the first co-productions to take advantage of the U.K.’s new tax credit. Around 10% of the $19 million budget is being provided as cashflow against the tax credit by L.A.-based financier Newbridge, which also is putting up a tranche of so-called “super gap” coin — a form of mezzanine debt that sits behind the conventional gap and presales finance provided by Bank of Ireland. The project also has equity from Australia’s FFC ($3.8 million), BBC Films ($1.9 million) and the U.K. Film Council’s Premiere Fund ($1.4 million).