188ÌåÓý

Where a production company incurs expenditure on equipment which is used in principal photography in the UK, this equipment will generally be treated as goods that are used or consumed in the UK.ÌýThis will also apply to items that are purchased as props or costumes which are used exclusively in the UK.Ìý

With smaller props and costumes, it is likely that these may be used in an overseas location as well as in the UK.ÌýHowever, for such items that are used on-screen, it may be relatively easyÌýto establishÌýwhere these are used or consumed by reference to the film or programme.Ìý

ExampleÌý

A production company purchasesÌýa car from overseas which has been specially adapted for use during principal photography and is likely to be damaged as a result ofÌýthe action scenes in which it will be used. On the assumption that such modification and damage meansÌýthat the car has no further value after filming, it is not treated as capital expenditure. The contract between the supplier and the productionÌýcompany is for a single supply of goods.Ìý

Because principal photography takes place in the UK, the car is used or consumed within the UKÌýand it is UK expenditure. This applies regardlessÌýof where the car is bought or modified, or where the supplier of the car is based.Ìý