The Independent Game Developers' Association (TIGA), the network for games developers and digital publishers and the trade association representing the games industry, informed UK games developers to look into the possibility of whether they can claim Tax Credits and, in the association's words "not look a gift horse in the mouth".
Recent research conducted by TIGA shows that Research & Development Tax Credits, as well as Games Tax Relief, can be important sources of financing for smaller developers. They urged all UK developers to explore whether they too can benefit from these reliefs.
The research, based on a survey of 52 UK games development companies, represents a wide selection of different company types, sizes, ages and markets, roughly proportionate to the overall UK industry. The key findings observed in the report include:
- 75% of respondents successfully claimed R&D Tax Relief over the previous 12 months.
- Of the 75% who successfully claimed relief, the average percentage of total costs claimed back was 22%.
- 25% of respondents still do not claim for R&D tax credits, most of them being small or micro companies.
- 62% of developers submitted a Games Tax Relief claim in the last 12 months.
- 81% of respondents indicated that they intend to submit at least one project for Games Tax Relief in 2017, and it is likely that some intend to submit more than one.
“The principal challenge holding back games developers is difficulty in raising finance. Developers can make life easier by using relevant tax reliefs: principally Video Games Tax Relief and R&D Tax Credits." said Dr. Richard Wilson, TIGA CEO in a press release. "Our research shows that studios successfully claiming R&D Tax Credits are on average claiming back over a fifth of their total costs. Likewise, Games Tax Relief allows studios to claim 25 per cent of qualifying games production expenditure as a corporation tax credit with no minimum or maximum expenditure. These reliefs effectively reduce the cost of development and allow studios to invest more in studios, staff and games.”
TIGA's membership consits of a number of accountancy firms who can help game developers claim R&D Tax Relief and Games Tax Relief. If you are a UK Developer and are unsure what you are or aren't entitled to, you can contact Suzi Stephenson at TIGA for introductions to these firms at [email protected]