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A theatrical production company may claim a theatre tax credit in respect of any accounting period in which it has a surrenderable loss¹. A company may surrender all or part of its surrenderable loss in an accounting period². The company's trading loss is reduced by the amount surrendered for the theatre tax credit³.

The surrenderable loss is the lower of⁴:

1. Ìý

   •ÌýÌýÌýÌý the company's trading loss for that period in the separate theatrical trade, plus any unsurrendered loss brought forward (its 'available loss'), and

2. Ìý

   •ÌýÌýÌýÌý the available qualifying expenditure

In the first period of account in which the trade is carried on, the available qualifying expenditure is the lower of⁵:

1. Ìý

   •ÌýÌýÌýÌý the amount of the qualifying expenditure that is UK expenditure (European expenditure, ie UK or EEA expenditure, prior to April 2024 – see below), and

2. Ìý

   •ÌýÌýÌýÌý 80% of the total qualifying expenditure

In any subsequent period of account, the available qualifying expenditure is expressed thus⁶:

where: