Museums & Galleries Exhibition Tax Relief | Frequently Asked Questions
If you are responsible for the finance and operations of a museum or gallery, you might be thinking about submitting a Museums & Galleries Exhibition Tax Relief claim, or you have already submitted a claim and are looking for some additional information for your next return. In this article, Hazel Pratt, Head of our Tourism & Hospitality Team has put together some frequently asked questions to help you submit your claim.
You can also check out Hazel’s video on the same topic here. Hazel helps museums and galleries submit their claims and is happy to receive any comments or questions you may have about the process, Hazel can be contacted via email – firstname.lastname@example.org
Who can claim Museums & Galleries Exhibition Tax Relief?
You must be a charity, the trading subsidiary of a charity or a company that is owned by a local authority. It’s also available for SCIOs (Scottish Charitable Incorporated Organisation) and charities limited by guarantee.
What costs qualify for Museums & Galleries Exhibition Tax Relief?
There are four phases to setting up an exhibition:
► Phase 1 – Development and decision to proceed with exhibition or not?
► Phase 2 – Planning and preparation (incurring set up costs)
► Phase 3 – The exhibition is open to the public
► Phase 4 – Dismantle and close the exhibition (time sensitive, i.e. within 12 months of opening only)
Only costs incurred during phase two and phase four qualify for the relief.
What costs don’t qualify for Museums & Galleries Exhibition Tax Relief?
Indirect costs, such as marketing and legal costs will not qualify for the relief.
What are the rates that can be claimed?
Relief will apply at rates of 20% for non-touring exhibitions and at 25% for touring exhibitions and the relief will be capped at an equivalent of £500,000 of qualifying expenditure per exhibition. The relief is based on 80% of eligible expenditure, meaning the maximum cash saving will be £80,000 for non-touring exhibitions and £100,000 for touring exhibitions.
How do I get the money back?
The claim forms part of your corporation tax return and can be submitted as soon as your Trust accounts have been signed off after the year-end. If your claim is successful, HMRC state that you will receive the cash within 28 days of making the submission.
What type of exhibitions would be eligible?
It must be an “organised collection of objects, works and artefacts which are of scientific, historic, cultural or artistic interest”. At least 25% of the qualifying expenditure must be spent in the European Economic Area (EEA).
Can I claim for an exhibit which includes a live performance?
You can’t claim for an exhibition which includes a live performance by a person or an animal. Performances by people incidental to the exhibition, such as costume wearing guides will not stop the exhibit from qualifying, but their costs are not allowable.
Can I claim running costs from the day of opening?
Running costs from the day of opening will not be eligible for relief. For example, invigilation costs when the exhibition is up and running are not allowable.
How long do I have to submit a claim?
You have got two years from when your accounts have been signed off to make the claim. But the sooner you get the claim in, the sooner you will get your money back.
Can you claim for costs for an exhibit which is touring within your museum or gallery?
Yes, only for costs that you have incurred in set-up and de-installing, within certain timescales.
Is there a cap on claims?
For each exhibition, there is a cap of £500,000 of qualifying expenditure.
What type of touring exhibition would qualify?
In order to qualify as touring, the exhibition must be held at two or more geographically different venues. The time between dismantling at one venue and setting up at another venue should not exceed six months. In addition, at least 25% of the works displayed at the first venue must also be displayed at the following venues.
I don’t pay corporation tax – can I still claim?
Yes, as long as you are in the charge to corporation tax. Also, if you have never been asked to complete a return by HMRC you can still claim.
Does my exhibition have to be in a museum or gallery in order for it to qualify?
No, it could be in a library or a castle for example, as long as all the other conditions have been met.
We plan to sell the items on display as part of the exhibition, does this still qualify?
No, one of the conditions of the relief is that you can’t sell the items on display.
The exhibition has been organised in connection with a competition, will the exhibit still qualify?
No, exhibitions will not qualify if they have been organised in connection with a competition of any kind.
Can I claim for private view only exhibitions?
You can have private viewing as part of the exhibit, but the exhibition itself must be open to the general public. Private viewing costs will not apply.
Can I claim for an exhibition which includes live animals?
No, you can’t claim for an exhibition which includes anything displayed which is alive.
Can I claim for storage costs?
You can only claim for storage costs if there is more than one venue for the display, the storage is off-site and will not be stored for more than 4 months.
Do you have any other questions about Museums & Galleries Exhibition Tax Relief?
If you have any comments or questions, please contact Hazel Pratt via email email@example.com
The information in this article is of a general nature and seeks to highlight some of the issues which could be affecting you and/or your business, including changes to financial regulation and legislation. Readers should not rely on this information without seeking professional advice on its application in their circumstances.