Film Tax credit sources allow Canadian producers of film, Televisie and digital media content to fast track their productions. Having said that it’s never easy in that world to beat the clock until it comes to completing the financing of projects in those 3 genres. But, as we maintain, financing those tax credits is a key part regarding every successful idea these days. Let’s dig in.
Whether the individual burden payer likes it or not Canadian provincial government, as well now the ‘ feds ‘are quite committed to subsidizing Canadian media via tax credits. Participants in the industry love it when the different provinces that round robin for your show square off and try to ‘ one up ‘ each other when it comes to the generosity concerning these funds.
Just the credits for your labor costs alone are generous on their own, repeatedly totaling 35-40 per cent depending on what province you are shooting or producing in. Quebec’s is indeed at 45% when it comes to labor.
While many pundits feel this undivided is just one example of a type of ‘ corporate success ‘ we receptacle only suggest to clients that they make the most regarding current legislation and funding. We do recognize that there are a clearing about taxes and jobs and economic activity around this quite thriving industry.
The concept of film (and TV and digital media) obligation credits is quite simple. You receive cheques for a percent of your expenditures on your project. It’s essentially simple as that. Canadian tax credits as a percentage of your expenditures are among the most unstinting in the world, and coupled with the stability of Canada’s financial system as well as our diverse geographies and talent natatorium simply make a case that Canada has… you guessed it.. earned the name Hollywood North.
Film tax credit sources address just one part of the overall ‘ capital cycle ‘ of any production. The other components of course include the owner equity component, debt, presales, Print and Advertising, etc. Times always change in the world of financing and in film, TV and media finance these days ‘ crowd funding’ is the hot new kid on the block, an other to the previously mentioned stock component.
The other new trend is ‘ slate ‘ financing, allowing producers to initiate financing for multiple projects.
In Canada there are a small handful about bank financing sources for film tax credits. Another alternative is business finance entities that are customarily faster when it comes to addressing your financing need. They have ‘ niche’ experience in your industry.
Tax credits are generally financed at 70% loan to value, are typically structured as ‘ bascule loans’ with no payments made until your tax credit is monetized by the government. Key to successful tax credit financing is your ability to have a credible team around your production, including energetic tax weight accounting expertise to ensure you qualify for maximum financing.
Seek out including speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in financing the value in your tax credit.