When should I claim Video Game Tax Relief (VGTR)?

When should I claim Video Game Tax Relief (VGTR)?

You can claim for Video Games Tax Relief (VGTR) on your Company Tax Return. You will need to calculate the amount of:

• additional deduction due to your company
• any payable credit due

You should also provide:

• a British cultural certificate from the British Film Institute (BFI) – if the game is still in development, you can provide an interim certificate and send the final certificate when the game is complete
• statements of the amount of core expenditure, split by European Economic Area (EEA) and non-EEA expenditure
• a breakdown of expenditure by category

You may make, amend or withdraw a claim to creative industry tax reliefs up to one year after the company’s filing date.

HMRC may agree to accept late claims in some circumstances.

HMRC has a specialist unit to deal with most claims for Video Games Tax Relief (VGTR) . Manchester Creative Industries Unit deals with the Corporation Tax affairs of most companies eligible for Video Games Tax Relief (VGTR) .

Video Games Tax Relief (VGTR) allows qualifying video games companies to make a deduction in their taxable profits or to surrender a loss for a payable tax credit. A game may make several tax relief claims during the production process. A claim may cover several games.

Since Video Games Tax Relief (VGTR) was introduced in 2014, 1,640 games have made claims, with UK expenditure of £4.4 billion.

In the year ending March 2021, £180 million of Video Games Tax Relief was paid in response to 350 claims, representing 640 games (average of £514k per claim, £281k per game). The amount of relief increased by 48% compared with the previous year. This can be explained by the timing of large payments for a small number of very high-budget games and underlying growth in the value of claims. A total of £624 million has been paid since the relief was introduced.

How TBAT can help

Similar to R&D Tax Relief, we help business check their eligibility and support in making claim for Video Game Tax relief. Please contact us to discuss how we can help.