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Overview of video games expenditure credit (VGEC)

From 1 January 2024, tax relief for video games is given through the video games expenditure credit (VGEC). Prior to 1 January 2024, relief was provided through an additional corporation tax deduction or a tax credit (see the Video games tax relief ― key provisions guidance note). The transition to the revised tax relief rules post-1 January 2024 is voluntary but will be obligatory for new productions from 1 April 2025 and for all productions from 1 April 2027, at which point the previous tax reliefs will cease. Where a company elects into the VGEC and the accounting period straddles 1 January 2024, expenditure is apportioned.

VGEC is a taxable credit which can be claimed by qualifying video games companies on certain expenditure. The amount of the credit is 34% of qualifying expenditure and this credit can be used