The government has increased the corporation tax relief available to theatres, orchestras, and museums. This is a temporary measure to benefit the cultural sector, which has been hard-hit during the Covid-19 pandemic.
The increased reliefs announced in this autumn budget will apply from 27 October 2021 to 31 March 2023. The rates of relief will reduce slightly from 1 April 2023 and will return to their previous levels from 1 April 2024. The cultural reliefs affected are theatre tax relief, orchestra tax relief, and museums and galleries exhibition tax relief, the proposed changes in the rates have been outlined below.
The cultural tax reliefs operate by providing companies with an additional deduction for qualifying expenditure when calculating their profits chargeable to corporation tax. The hope is that the increased relief should encourage increased investment in the UK’s cultural industries.
The increased relief will also provide much-needed support to those businesses in the cultural sector who may be struggling to recover from the impact of multiple closures during the pandemic.
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