MGETR50045 - Museums and Galleries Exhibition Tax Relief: qualifying exhibitions: minimum expenditure condition - transition rules

For accounting periods ending on or after 1 April 2024, the European expenditure condition is replaced by the UK expenditure condition.听

This means that the previous听requirement for at least 25% of a production鈥檚 core expenditure to be European expenditure no longer applies. It is听replaced by a requirement that at least 10% of a production鈥檚 core expenditure听is UK expenditure.听

UK expenditure is defined as: 鈥榚xpenditure on goods and services which are used or consumed in the United Kingdom鈥�.听

This change does not apply to a production if听

  • it has entered the production phase before 1 April 2024, and听

  • the separate trade in respect of the production ceases before 1 April 2025.听

The European expenditure condition applies to these productions throughout.听

If听

  • a production begins before 1 April 2024听but the separate trade does not cease before 1 April 2025,听and听

  • the European expenditure condition is met in respect of core expenditure incurred before 1 April 2025听

then the production will not lose its entitlement to relief on expenditure incurred before 1 April 2025 in the event that听it later fails the UK expenditure condition.听

The production company鈥檚 tax return for the first accounting period which ends on or after 1 April 2025 should include a statement of how much of core expenditure incurred before 1 April 2025 is European expenditure, to show whether the European expenditure condition was met at that date.听