Ireland is an attractive location for film production companies. Audiovisual projects undertaken in Ireland benefit from a number of tax breaks and financial supports, all underpinned by a 10-year government plan to foster the industry's growth, the Audiovisual Action Plan, discussed here.
Ireland's tax breaks for film production
Providing a project meets the eligibility requirements, production companies can access generous tax breaks based on related expenditure incurred in Ireland. Chief among them is the Section 481 film tax relief, which was recently extended in Budget 2019 until at least 2024, providing investors with certainty.
Film tax relief can be credited against corporate tax payable in Ireland, which is already just 12.5%. If the relief is more than any tax due, Revenue will pay the difference.
The amount of relief due depends on the production costs of the qualifying film. The credit is 32% of whichever is the lowest of:
- eligible expenditure; or
- 80% of total film production costs; or
- €70m (about $75.9m).
A broad range of costs are considered eligible expenditures, including payments made for goods, services, and facilities in Ireland. It also includes costs to employ those involved in the production of a film.
There are conditions attached relating to training of new personnel in a production, and the Government has recently launched new skills development courses and enhanced training and skills development opportunities, to support producers to meet these eligibility requirements.
Budget 2019 changes to Section 481 relief
The 2019 Budget made a number of changes to the regime.
The Government has decided to split the certification process between the Revenue Commissioners and the Department of Culture, Heritage and the Gaeltacht.
Producer companies are now required to first apply for a cultural certificate before they commence Irish production. The Government says this will enable earlier engagement to ensure that the project will meet the requirements to access the tax breaks.
In addition, producer companies can now apply directly for a certificate from the Minister for Culture, Heritage, and the Gaeltacht stating that a planned project will be treated as a qualifying film for the purposes of Section 481. Applications were previously made directly to the Revenue Commissioners.
The Budget also introduced a self-assessment basis for access to the tax credit, which is intended to support efforts to ensure only those eligible for the relief access it.
Producer companies should apply for a certificate in writing to the Minister for Culture at least 21 days before production is set to begin.
Irish Audiovisual Action Plan
In June 2018, the Government released its 10-year Audiovisual Action Plan, which aims to almost double the value of productions undertaken in Ireland. Ireland aims to grow its audiovisual sector to €1.4bn by 2027.
In 2019, the sector contributed €357m directly to the Irish economy, together with an estimated €200m in export earnings.
Since the Irish Government introduced its 10-year action plan to support the industry, the Government has introduced the Regional Film Development Uplift, which offers additional tax reliefs to incentivise film productions in the regions. The Government has also increased funding by 17% for Screen Ireland, the development agency for the Irish Film Industry.
Last year, Ireland signed the revised Council of Europe Convention on Cinematographic Co-production. This lays the foundations for partnerships on co-productions with other European countries.
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