If a production company is planning to apply for the Production Services Tax Credit in B.C., here is some essential information about the recent changes from Creative BC.
The What:
The Production Services Tax Credit (PSTC) in B.C. is administered by Creative BC and as of September 24, 2019 an additional step has been added in the process of applying for the film tax credits. Pre-certification is now required to be eligible for the PSTC. The pre-certification is intended to help Creative BC forecast and plan for the volume of applications that are soon to be received. If the production company has already received a PSTC certificate, pre-certification is not required.
The When:
Productions that have not applied for PSTC, but have incurred costs on or after July 1, 2020
Production companies are encouraged to apply for the pre-certification as soon as possible but must apply no later than 60 days after first incurring any labour expense related to the production. This requirement applies to all productions that first incurred accredited BC labour expenditures beginning on or after July 1, 2020.
e.g. If the production company first incurred labour on July 1, 2020, the company must file for the pre-certification by August 30, 2020.
If the production company applies for the pre-certification later than 60 days after the production first incurred labour expenses, then only labour incurred on or after the date of when the application was submitted may be used to apply for the PSTC.
e.g. If the production company first incurred labour on July 1, 2020 but did not apply for the pre-certification until September 1, 2020 (after the 60-day application window), then only labour incurred on or after September 1, 2020 maybe used in the calculation of qualified labour expenditure for the PSTC. All labour incurred between July 1 and August 30 would be ineligible.
Productions that have not applied for PSTC, but have incurred costs before July 1, 2020
If the production company first incurred labour expenses PRIOR to July 1, 2020, the company is still required to apply for the pre-certification, however the 60-day deadline will not apply. All accredited BC labour will still qualify for the PSTC. The production will be eligible for the PSTC if all other requirements are met.
e.g. If the production company first incurred labour expenses on June 30, 2020, but did not apply for pre-certification until October 15, 2020, all accredited BC labour between June 30, 2020 and October 15, 2020 will still qualify for the PSTC.
The How:
- Complete the brief pre-certification form available online on the Creative BC website, here.
- There is no fee to apply for the pre-certification.
- Production companies will be required to disclose the following:
- Details about the production company and type of film project
- Estimated dates for principal photography
- Expected year for which the production company will first file a PSTC claim
- Estimated total cost of the production
- Estimated costs to be spent in B.C.
- Estimated accredited qualified B.C. labour expenditure
- Estimated accredited qualified B.C. DAVE labour
- Whether the production company expects to apply for Regional and Distant Regional film tax credits.
The application is based on the budgeted estimates, so the exact or final amount of labour expenditure is not required.
Additional Information:
More information is available on the Creative BC website at CreativeBC.com, or you can connect with one of our specialists at Baker Tilly WM for help navigating this process. Don’t miss the deadline or miss out on potential Production Services Tax Credits. Get the answers to your questions.
Authors:
Tim Chan - formerly working in the film industry, Tim is currently working with the Entertainment and New Media division of Baker Tilly WM LLP.
Carmela Serrano - also originating in the film industry, Carmela is currently working with the Entertainment and New Media division of Baker Tilly WM LLP.
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