OTR20020 - Orchestra Tax Relief: how to make a claim: additional deduction
The OPC should indicate that it is claiming OTR using the software that it is submitting its return with. All returns must be filed online. It should complete the relevant boxes below depending on the version used.
| Description | Version 2 box name | Version 3 box name |
|---|---|---|
| Tax due | 86 | 525 |
| Creatives tax credit | - | 540 |
| Amount claimed | 87 | 545 |
| Amount payable | 89 | 570 |
| Creatives core expenditure (not supported by all software) | - | 663 |
| Creatives additional deduction | - | 665 |
| Film/Creative tax relief | 167 | n/a |
| Enhanced expenditure | 101 | 670 |
| Payable creatives tax credit | 168 | 885 |
Please note that Version 1 does not provide the relevant boxes needed to claim OTR.
The company should also tick box 658 to confirm that it has completed an additional information form. These boxes are in Version 3 only.
Example
An OPC incurs total expenditure of £250k on a qualifying production. Of this expenditure, £200k is core expenditure. £150k (75%) of that core expenditure is UK expenditure and £50k (25%) is non-UK expenditure. The company is entitled to the following deductions:
- £250k 'ordinary' deduction, plus
- £150k additional deduction (the core UK expenditure is less than 80% of £250k, so it all qualifies)
Giving a total deduction of £400k.
The OPC has profits of £50k before tax, meaning it has a loss of £100k after the additional deduction. It decides to surrender this loss in full. The applicable credit rate (see OTR10070) is 45%, giving a tax credit of £45k.
When completing the CT600P:
Total core expenditure for the accounting period is £200k. This amount should be entered in box P295A.
UK core expenditure for the accounting period is £150k. This amount should be entered in box P295B.
The additional deduction for the accounting period is £150k. This amount should be entered in box P295C.
The loss surrendered for the accounting period is £100k. This amount should be entered in box P295D.
The amount of tax credit for the accounting period is £45k. This amount should be entered in box P295E.
Note: if the OPC was claiming tax relief for multiple concerts or concert series, the combined figures across all productions should be included in boxes P295A to P295E.
The CT600P then calculates the amount of credit used to discharge tax liabilities in box P325, and the payable credit amount in box P330. The OPC has no outstanding liabilities, so P325 equals 0 and P330 equals the full tax credit amount of £45k.
When completing the CT600:
Box 540 must equal box P325. This then feeds into boxes 545 and 570.
The company has not received any surrendered expenditure credit from a fellow group company, so it does not need to use box 614.
The company should tick box 658 to confirm it has completed an additional information form.
Box 663 must equal box P310.
Box 665 must equal box P315.
Box 885 must equal box P330.