Navigating UK Tax Relief in Multi-Episode TV Projects

If you're managing a multi-episode TV production, you're already familiar with the juggling act. Cast schedules, location availability, post-production deadlines, budget pressures – and somewhere in the middle of all this creative chaos, there's a significant financial opportunity that deserves your attention: the UK's Audio-Visual Expenditure Credit (AVEC).

Since AVEC replaced the High-End Television Tax Relief in April 2024, we've seen production teams navigate this transition with varying degrees of success. The good news? Once you understand how AVEC works across multi-episode productions, you can unlock substantial cash flow benefits that make those sleepless nights during production a little more worthwhile.

Let's break down exactly how to make AVEC work for your multi-episode production, from the basic qualifying criteria through to real-world examples.

The Basics: TV Programmes That Qualify For AVEC

Before we dive into the multi-episode specifics, here's what every TV programme needs to qualify for AVEC:

• At least 10% of your total production costs must be UK expenditure
• Pass the BFI cultural test or qualify as an official co-production
• Avoid excluded content (news, current affairs, discussion programmes, competitions)
• Have genuine commercial intent for public broadcast

If you meet these criteria and have a qualifying ‘high-end’ television programme, you can claim a 25.5% tax credit on your eligible core costs.

Children's television programmes and animations benefit from enhanced rates (29.3%) and modified criteria. Children’s TV programmes must be intended for kids under the age of 15. Animations must spend at least 51% of their core cost budget on animation. These productions are not required to meet the requirements of high-end TV, discussed below.

Slot Length Challenges For High-End Productions

This is where many productions hit their first hurdle. Multi-episode programmes face specific requirements that can catch you off-guard if you're not prepared.

To claim for AVEC, high-end productions must meet the content requirements for a drama, comedy or documentary, as well as the following slot length requirements.

The minimum budget requirement is £1 million per hour of programming, calculated pro-rata. So, a 30-minute programme needs a minimum £500,000 core cost budget; 2 hours – £2 million minimum.

There’s another rule to consider: every single episode must have a minimum slot length of more than 20 minutes. Here's the catch – if even one episode falls short, your entire programme becomes ineligible.

The slot length is determined by your commissioning broadcaster and includes advertising time. For streaming platforms without ads, your programme runtime equals your slot length.

Claiming Across Multiple Accounting Periods

Here's where AVEC becomes particularly powerful for multi-episode productions. Unlike some tax reliefs that lock you into annual claiming cycles, AVEC's cumulative nature gives you real flexibility:

• Option 1: The Single Final Claim – Wait until production wraps completely, then submit one comprehensive claim with your final BFI certificate. This approach offers simplicity and certainty, as you won’t have to estimate any totals and you’ll only need to apply to BFI once. However, it delays your cash flow benefits until the very end of your production cycle.
• Option 2: Interim Claims Throughout Production – Make multiple claims using interim BFI certificates as you complete different phases of production. This means more paperwork and administrative overhead, but it also means accessing tax credits during production when cash flow pressure is typically at its peak.

How do you decide? Consider your financing structure. Productions running on tight cash flow constraints typically benefit significantly from interim claiming, while those with robust funding may prefer the administrative simplicity of a single final claim.

For productions spanning 18 months or more, we generally recommend exploring interim claims – the cash flow benefits often outweigh the additional complexity.

Aligning Your Production Schedule with Your Claims

Strategic planning here can make the difference between smooth sailing and financial headaches. Whether you’re planning to break up your claim or submit in one go at the end, early preparation will save you time and resources.

• Map your production calendar against claim deadlines early. You can make a claim for each accounting period, which is much easier when you have the relevant information already saved. BFI has their own delays on top of the time it takes for you to prepare your claim, so factor this into your deadlines.
• Implement real-time expenditure tracking. This isn't just good practice; it's essential for maximising your relief. Monthly reconciliation against your production budget helps identify issues before they become expensive problems. Set up systems that categorise spending as it happens:

• UK versus non-UK expenditure
• Above-the-line versus below-the-line costs
• Qualifying versus non-qualifying categories

• Consider appointing a dedicated compliance coordinator. For complex multi-episode productions, having one person responsible for BFI liaison, documentation requirements, and tracking production costs can prevent pricy oversights.

A Real-World Example: How This Works in Practice

We’ve prepared an example below that should help you visualise how an AVEC claim is prepared across multiple accounting periods. If you need a reminder of the rates you can claim with AVEC, check out our discussion on what AVEC is worth.

Consider a six-episode drama series with a £12 million total budget (UK and non-UK), produced across two accounting periods. Episodes 1-3 are filmed and completed in Year 1 with £6.5 million in qualifying UK expenditure, while episodes 4-6 are completed in Year 2 with £4.5 million in qualifying UK expenditure.

Using the cumulative approach, the company could submit an interim claim at the end of Year 1 for the £6.5 million in qualifying expenditure, generating approximately £1.66 million in tax credits (at 25.5% rate). This provides crucial cash flow for Year 2 production while episodes 4-6 are being completed.

At the end of Year 2, the company would then submit a final claim covering the remaining £4.5 million in qualifying expenditure, generating an additional £1.15 million in tax credits. The total relief across both years reaches £2.81 million, representing over 23% of the total production budget.

This approach requires careful documentation throughout both years, including maintaining separate accounting records for each claim period and applying for both interim and final certificates from BFI. However, the cash flow benefits of accessing £1.66 million in Year 1 rather than waiting until Year 2 often justify the additional administrative complexity.

What's Next?

AVEC offers genuine opportunities for multi-episode productions, but the complexity increases significantly when you're working across multiple accounting periods. The key is early planning and systematic implementation.

If you're currently planning a multi-episode production or struggling with an existing AVEC claim, we're here to help.

Want to dive deeper? Download your free copy of our comprehensive eBook on AVEC claims here. It covers everything from BFI certificate applications to HMRC submission requirements, with practical examples and common pitfall warnings that can save you both time and money.

Questions about your specific production? Get in touch with our expert team! Every production has unique circumstances, and we find that a brief conversation often clarifies whether AVEC makes financial sense for your particular situation.