The french movie tax credit (crédit d’impôt cinéma)
Context: France is proud of its heritage and is determined to spread it worldwide although they already are the number one touristic destination in the world. Films and other fictions play a substantial part in this promotion. That is why the Ministry of Culture has set up important tax incentives for film producers, which are even more attractive for foreign companies.
French movies incentives for corporations based in France (including therefore subsidiaries of foreign groups)
The prequisites and conditions
The conditions to obtain a refund are (1) an agreement from the Centre National du Cinéma (2) the majority of the movie/episode has to be shot in French. In practice, the agreement is needed prior the launching of the French movie performance.
Moreover, the tax credit cannot cause all subsidies to overtake 50% of the overall budget.
The base of calculation…
The movie tax credit (Crédit d’Impôt Cinéma in French) allows any producer to collect a refund of certain expenses. Eligible expenses for the tax credit are royalties paid to authors, salaries and social costs paid for technical staff members, expenses incurred to cut/edit/ the movie… to sum up almost all expenses. The total of expenses entitled to this credit is capped at 6 M€
and the rate
The tax credit is calculated per episode or movie and represents up to 30% of the aforementioned costs, which means the movie tax credit is capped at 9 M€ accordingly.
and the refund
If the tax credit has not dedudted from the tax bill, it is immediately refunded.
French movies incentives for entities based outside France
The conditions and the calculation of this tax credit (in French Crédit d’impôt pour production de films et ouvres audiovisuelles étrangers) are the same (agreement of the CNC, expenses capped at 30 M€, etc.) at the exception (1) that the movie/episode is required to highlight parts of the French heritage, but is not required to be shot in French.
Hence, the movie tax credit is capped at 9 M€ accordingly.
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