TAX SHELTER

Not a fund, but a system. The system offers tax advantages to Belgian companies that invest in Belgian audiovisual productions. 

The Tax Shelter system has been reformed recently. The new law is valid since January 2015.

Simplified rules:

* The project must be recognized as a "European audiovisual production". These can be minority productions as well. Certification document issued by the Flemish or French Community in Belgium.

* A Belgian production company must be involved as a co-producer, being the beneficiary of the tax shelter investment.

 

* The investor must be a Belgian registered company, submitted to Belgian tax laws, that makes enough benefits to  invest in film.  Production companies, banks and tv-stations are excluded.

 

* The Production Company and eventually the Intermediate Party must be recognised by the tax authorities. 

 

* The system results in a tax benefit plus eventually an interest reimbursement may lead to a return on investment of max. 13% for the investor.

 

* No rights are given away to the investor (as it used to be in the old legislation)

* No more than 50% of the budget may be financed with Tax Shelter financing.

* The Production Company has a strict spending obligation for production expenses in Belgium, within 18 months after signature of the agreement with the Investor.

In short:

 

* To get Tax Shelter money, you need a Belgian (co-)producer, a Belgian investor and enough spending left to be made in Belgium.

* There are several strict rules to follow.

 

* No producer will enter into a tax shelter contract if the outcome of the production is not sure.

 

* Although the new law puts an end to certain abuses of the system that may have occurred in the past, the high level of   administrative follow up and the intermediate fees and interests that have to be paid, lead to a higher production cost.

The Tax Shelter system makes no distinction in film genre. The same rules apply to all genres.

In reality, it is more difficult for documentary projects to attract Tax Shelter money. Investors are generally more interested in large projects, with an outlook to a large public visibility. 

Documentary producers in Flanders try to promote the 'natural assets' of their projects to attract investors that have an emotional relationship with the treated subject in the film.

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