Section 33 | Special credit for visual effects

(1)Section 1179EC of CTA 2009 (special credit for visual effects) is amended as follows.

(2)In subsection (2)—

(a)omit the “and” after paragraph (a),

(b)after that paragraph insert—

(aa)a claim for Chapter 3 credit has been made for the last accounting period in the AVEC period (which may be the claim period) in which the company incurred relevant global expenditure (see section 1179CA(2)) that is UK expenditure (see section 1179AB), and

, and

(c)in paragraph (b)—

(i)omit “where a claim has been made for Chapter 3 credit (whether for the claim period or earlier),”, and

(ii)for “such claims” substitute “Chapter 3 credit claims in respect of the film or television programme”.

(3)In subsection (3)(b) for paragraph (i) substitute—

(i)the adjusted VFX portion of Chapter 3 credits claimed in respect of the film or television programme, and

.

(4)In subsection (4)—

(a)in the words before Step 1, for “previously claimed Chapter 3 credits” substitute “Chapter 3 credits claimed in respect of the film or television programme”, and

(b)in Step 1—

(i)in the words before paragraph (a) omit “(see section 1179CA(2))”, and

(ii)in that paragraph omit “(see section 1179AB)”.

(5)After subsection (6) insert—

(6A)Where a production company has claimed an additional amount of audiovisual expenditure credit for an accounting period and makes a claim for Chapter 3 credit for a subsequent accounting period—

(a)the additional amount is to be calculated for that subsequent accounting period, and

(b)if that additional amount is negative, the amount of Chapter 3 credit to which the company is entitled for that period is to be reduced by the additional amount.

(6B)Where Chapter 3 credit claimed by a company for an accounting period is reduced as a result of subsection (6A)(b), for the purposes of the application of subsections (3) and (4) in relation to the company for any subsequent accounting period—

(a)the sum of the additional amounts of audiovisual expenditure credit previously claimed (as referred to in subsection (3)(b)(ii)) is to be reduced by the additional amount referred to in subsection (6A)(b), and

(b)in determining the sum of Chapter 3 credits claimed by the production company for the purposes of Step 4 in subsection (4), ignore the reduction of any Chapter 3 credit resulting from the application of subsection (6A)(b).

(6)The amendments made by this section have effect in relation to any claim made for Chapter 3 credit, or an additional amount of audiovisual expenditure credit, for accounting periods beginning on or after 26 November 2025.