UK games industry tax relief to be 'among the most generous in the world'

Will offer payable tax credit worth 25 per cent of qualifying expenditure.

The video game industry corporation tax relief will be "among the most generous in the world" at "25 per cent of qualifying expenditure", Chancellor George Osborne has promised in the official statement from the treasury.

The relief offered to the creative sector also includes animation and television production, and will come into effect from April 2013. Qualifying companies will be offered a choice between "an additional deduction at a rate of 100 per cent of enhanceable expenditure or a payable tax credit at a rate of 25 per cent of qualifying losses surrendered".

Full details will be published on December 11.

In addition, the rate of corporation tax has been cut once again, down from 22 per cent to 21 per cent with effect from April 2014. Osborne claims this will be the "lowest rate" of any major western economy.

"I have already cut the main rate of corporation tax from 28 per cent to 24 per cent and it is set to fall further to 22 per cent," said Osborne.

"This has helped British companies and frankly left other countries scrambling to keep up. They will have to try harder. For I am today cutting the main corporation tax rate again by a further 1 per cent."

Source: FT Advisor | HM Treasury