Production/Tax Incentives Glossary
There are now 39 domestic jurisdictions including the U.S. Federal Government and Puerto Rico, and over a dozen international jurisdictions offering film, television, and commercial production incentives not including jurisdictions offering Sales and Use Tax, GST, and VAT Exemptions and Waivers. These incentives are offered either as Refundable tax credits, Transferable tax credits, production Rebates, or Up front / Backend Production Funding.
Jurisdictions offering “tax credits” as “production incentives” administer and process these incentives through the filing of an income tax return by the Production Company in the state or country.
Refundable Tax Credits
These credits
are refunds provided by the Tax Authorities once the Production Company has filed an income tax return. The refundable credit consists of excess production credits remaining after all income taxes are paid, and are received regardless of owing any income tax liability.
Transferable Tax Credits
These credits
are Non-Refundable Tax Credits, which if not used to offset the Production Company’s income tax liability, the Production Company is allowed to sell the Tax Credits directly to local taxpayers, or indirectly through brokers.
Rebates
Rebates
are funds paid to the Production Company, directly from the respective domestic or international Film Office, and are typically not administered by the respective domestic or international Tax Authorities, and are not processed through Income Tax Returns.
Up Front / Backend Production Funding
These are funds, provided by local investors / taxpayers in exchange for advantageous local tax treatment, granted to eligible productions.
For more specific information, please contact the EP Production Incentives Group. |
 |
|