VFX tax relief rises to 39% for qualifying UK spend

The new, increased rate of tax relief for UK visual effects (VFX) expenditure comes into effect this week.

The measure means that film and HETV production companies can claim a 39% rate of Audio-Visual Expenditure Credit (AVEC) on their UK visual effects costs – the AVEC’s 80% cap on qualifying costs will be removed for UK VFX costs.

Eligible productions can claim from 1 April 2025 on any expenditure incurred on or after 1 January 2025.

The tax relief will be available to companies once the project has received a final certificate from the BFI, ie the completion and post-completion periods. For interim periods, the production company can claim the standard rate of 34% of AVEC.

CEO of Screen Alliance, Neil Hatton, said: “Today opens a new chapter in the history of VFX in the UK. We already had a reputation for high quality, innovation and creativity. Now, productions will be incentivised to place many more millions of dollars of inward investment work with our award-winning VFX community, creating jobs and considerable value for the UK economy.”