Section 1179CA | Amount of expenditure credit

(1)The amount of the expenditure credit to which a qualifying company is entitled for an accounting period is determined as follows.

Step 1Ascertain the total of the company’s relevant global expenditure (see subsection (2)) for all accounting periods up to and including the present one.

Step 2Deduct from that total any expenditure that is not UK expenditure (see section 1179AB).

Step 3If the amount remaining after step 2 exceeds 80% of the total ascertained at step 1, deduct the amount of the excess.The remaining amount is the company’s “qualifying expenditure to date”.

Step 4Deduct from the company’s qualifying expenditure to date the amount (if any) that was the company’s qualifying expenditure to date in the accounting period for which it was last entitled to, and claimed, an expenditure credit in respect of the qualifying production.The remaining amount is the company’s “qualifying expenditure for the period”.

Step 5The amount of the credit to which the company is entitled is the relevant percentage of the company’s qualifying expenditure for the period.The relevant percentage is determined by—

section 1179DV, in the case of a film or television programme;

section 1179FN, in the case of a video game.

(2)Expenditure is “relevant global expenditure” for an accounting period if—

(a)it is brought into account under section 1179BB in calculating the profits of the separate production trade for that period, and

(b)it counts as relevant production expenditure in relation to the qualifying production under—

(i)section 1179DR, in the case of a film or television programme;

(ii)section 1179FJ, in the case of a video game.