"We want the companies that are actually developing the game to access the relief – not the people who are sat behind it financing it," opened Adrian Maloney of HMRC during his talk at TIGA's Games Tax Relief tour, today in Manchester.
"This is a tax based relief, not a grant based relief, so it's not money you get up from – you have to incur the expenditure," he explained. "You pay the money out, you submit your claim, and then we reimburse you if you qualify."
Maloney's presentation – one of a series taking place in Media City on Salford Quays – was designed to simplify a Games Tax Relief process that, despite being laid out by both trade associations TIGA and UKIE, has the potential to confuse the very body of people it's designed to aid.
Some interesting points to note: Games Tax Relief is not available to individuals. You can be a solo developer and qualify, but you must register as a company in order to submit your claim.
The Relief covers everything from the actual designing of the game through to production and even testing. Subcontracted work also qualifies, albeit up a limit of £1 million.
We are going to have to deal with advergames on a case by case basis.Adrian Maloney
Another caveat: As things stands, 'advergames' – titles produced for advertising or promotional purposes – and gambling games will not qualify for Games Tax Relief, though Maloney, who runs HMRC's Manchester Relief team for the creative industries, did admit that rule isn't yet set in stone.
"We are going to have to deal with this by a case by case basis, and as claims come in we're going to have to have a common understanding by what qualifies," he said, adding that games of any guise have to be ready for "supply to the general public" to qualify, though HMRC does not classify the method of supply.
"For tax purposes, a game is completed when copies of it are ready to be made and release to the general public," he continued, "though I admit there is an on going debate as to the definition of when a game is finished."
Turn it around
Maloney said HMRC's "turn around [for claims] is expected to be approximately 28 days, but we'll try and beat that if possible."
He added, "We know a lot of companies rely on this kind of funding for their cash flow. Obviously we've got to police it as well – we've got to make sure we're handing out the Treasury's money appropriately."
Maloney also concluded by stating that there will be ramifications for those who look to take advantage of the system.
"One thing I will mention is, this has been a long campaign by a lot of people – I think everyone is agreed it is a positive thing for the games industry, but if people are seen to abuse the relief, that will have implications," he concluded.
You can find more information on Games Tax Relief here.