How tighter investment regulations are benefiting the UK screen industry
Calculus Capital CEO John Glencross has been published in FT Adviser.
Advisers and clients could be understandably nervous about tax-efficient investing in this sector after HM Revenue & Customs’ well-publicised challenges to historic models. In April last year new regulations also came into place that tightened up what HMRC considered to be loopholes in the enterprise investment scheme (EIS) legislation. The Treasury was clear: the generous tax benefits associated with EIS – like 30 per cent income tax relief, capital gains tax-free profits, loss relief and no inheritance tax on shares after three years – come at a price.
They are there to attract investors willing to take on some investment risk to help Britain’s most promising young companies.
Last month the BFI launched the first of this new breed of EIS screen content funds. Working with industry veterans at Stargrove Pictures, Calculus Capital won a competitive selection process to manage it independently of the BFI, which is a charity.
Others EIS funds will inevitably follow.
One producer I spoke to recently summed it up: “It is so refreshing to be talking about investment to grow a business rather than having to talk about project finance.”
The BFI’s deputy chief executive, Ben Roberts, adds: “EIS funding hits a sweet spot. This is the first time we’ve seen a possibility to really support the brilliant emerging production companies we meet, as well as more seasoned film executives who might be looking to recalibrate their business and start something new at a point where film and television in the UK is just exploding.
“The demands from the likes of Amazon and Netflix are extraordinary and can be met by really brilliant creative people from all over the UK.”
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