Income tax treatment of the screen production industry under the Income Tax Act 2004

How income tax is treated for the screen production industry under the Income Tax Act 2004.

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Executive summary

Key points of the income tax treatment of the screen production industry under the Income Tax Act 2004.

Part I - Background

The New Zealand screen production industry is subject to special income tax rules is in line with the Government's efforts to encourage the development of the industry.

Part II - Income from films: section CC10

Section CC 10 deals with income from films where a person has a "right or interest" in or to certain tangible assets relating to a film.

Part III - Deductions and timing rules

There are rules that apply to allowable deductions particularly around timing.

Part IV - Special rules deferring deductions for expenditure in relation to films

Deductions otherwise available will be deferred by the deferred deduction rule (DDR) if certain criteria are met.

Part V - Other specific anti-avoidance provisions dealing with films

Deductions allowed for film expenses and expenditure under certain conditions.

Part VI - Large budget screen production grants

The large budget screen production grant (LBSPG) scheme provides for a rebate of 12.5 per cent of the Qualifying New Zealand Production Expenditure to film and television production companies if certain requirements are satisfied.

List of reference material

There are a number of resources which can help those involved in screen production industry tax issues.

Appendices

Flow diagrams showing an overview of the screen production industry, how sub-part DS of the Income Tax Act 2004 operates and how the large budget screen production grant works.

Date published: 11 Oct 2005

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