A consultation on the introduction of an orchestra tax relief that would encourage orchestras to perform across the whole of the UK was launched in January of this year. The consultation has now closed and HM Treasury has published a detailed response.

HM Treasury received and considered a total of 57 responses to the published consultation document. These included submissions from large and small orchestras in both the professional and amateur sectors. The respondents were generally in favour of the introduction of tax relief for orchestras.

The orchestra tax relief will closely mirror the existing theatre relief and is expected to include the following key features:

• to qualify for relief, the business must be incorporated and engaged in the production of live orchestral performances, as defined below;
• relief will take the form of an additional deduction for corporation tax purposes which can be surrendered for a payable tax credit;
• tax relief will be available for the creative and production costs of live orchestral performances but not for day-to-day running costs;
• there will be a higher rate of credit for performances that are part of a tour to encourage orchestras to play for a wide range of audiences;
• to ensure that the claims process is effective and efficient, it will be possible for orchestras to group together multiple qualifying performances into one tax relief claim.

The draft legislation to introduce the new tax relief is expected to be published in autumn 2015 with the new tax relief set to come into force in April 2016.