Accelerated tax relief is available for the capital costs of producing
or acquiring a low-budget (below £15m) British film. The current
scheme of relief was due to expire on 1 July 2005, but it has been
extended in the Budget to 31 March 2006 (with the possibility of
a later date being substituted after European clearance has been
obtained for 'state aid' for the film industry). The relief
will be available where the first day of principal photography is
before 1 April 2006 and the film is completed before 1 January 2007.
On the other hand, the Revenue are clamping down on a number of
tax avoidance schemes which exploited this relief - in their opinion
unfairly - from 2 December 2004.
It is intended to bring in a new relief for the costs of renovating
business property which has been empty for a year in designated
'disadvantaged areas' . This requires European approval
for 'state aid' to the industries affected, and will not
be introduced until that approval is obtained. The capital costs
of such renovations would normally not be relieved immediately,
but the intention is that a 100% capital allowance should be
available. This new relief will to some extent offset the withdrawal
of the SDLT exemption for acquisition of property in disadvantaged
The 2004 Budget introduced a relief for income tax-paying landlords
who carry out works to improve the energy-efficiency of rental properties.
Up to £1,500 can be relieved per property, if spent before
6 April 2009. The rules are amended from 7 April 2005 to allow solid
wall insulation as well as loft insulation and cavity wall insulation.