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Corporate tax relief for video games

  • United Kingdom
  • Technology, Media and Telecoms



The order which brings in (with effect from 1 April 2014) corporate tax relief for certain video games was made on 22 July. 


The relief is in the form of a repayable tax credit and is available in relation to qualifying production costs.  Draft legislation to implement the relief was produced previously, but the EU Commission’s approval was required.

So what?

In short, tax relief will be available on qualifying production costs.  Qualifying production costs may include design, production and development of the video game.  There are various exclusions.  For example, if the primary purpose of the game is to promote or advertise other products the relief is not available (although some product placement and in-game advertising is allowed).  The video game itself must satisfy the “cultural test”, that is it must be a “British video game” in accordance with conditions set by the Secretary of State.  For readers to whom the relief is potentially relevant, the BFI has produced useful guidance notes on the cultural test and your tax advisor should be able to offer specific guidance.