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The UK gaming market is now worth nearly £6 billion, partly due to the meteoric success of titles like The Grand Theft Auto & Tomb Raider series.
The UK gaming market is now worth nearly £6 billion, partly due to the meteoric success of titles like The Grand Theft Auto & Tomb Raider series. But breaking into this market isn't always easy; not only does it need technical knowledge and creativity, it also generally requires funding.
The good news is that there are a few ways to help finance your indie game and get it off the ground - one of which is the UK Games Fund.
The UK Games Fund offers grants up to £25,000 to games development businesses that are just starting up or haven’t been around very long. It’s designed for businesses looking to build working prototype games, and to support those wishing to pitch new concepts. Making a successful application will hinge on how well you explain what benefits the programme will bring to both your project, and to your wider business.
How best to do this depends on a few different factors. For smaller companies and brand new start-ups, the benefits are likely to revolve around getting the project off the ground. It will also be about gaining visibility and support for the new game, and how it will help pitch your ideas. Conversely, the angle will likely be slightly different for companies that are more established. These types of organisations need to make it clear in their application how the programme could help grow their project or expand their team. It could also be about mitigating risks or starting a spin-off project; whatever it is, the narrative needs to make clear that these developments wouldn’t otherwise happen without UK Games Fund support.
Only the costs in relation to UK employees and UK contractors can be claimed for, and there must be a minimum of one PAYE employee or Director (paid via PAYE) at the time the grant is claimed. The net pay of all UK-based employees must also be evidenced - this could be by showing bank statements or payslips.
No other types of costs will be considered and including them may well end up negatively affecting your application.
The following conditions also apply:
There is a grant cap of £6,000 per month, but successful applicants are welcome to add their own money too it if they wish.
Applications for this year are no longer being received and the competition is closed, but they are typically made online using the UK Games Fund website. However, funding looks set to continue beyond 2020 so keep an eye out for further updates. Rounds are typically open early in the year, around January time.
Although this year’s round of the UK Games Fund is now closed, there’s still plenty of opportunity to gain financial help through the VGTR scheme.
Video Games Tax Relief (VGTR) is part of a suite of financial incentives the UK government offers to help innovative companies grow. It works by allowing video games studios to receive a rebate in respect of a video game, as a cash payment.
How much the payment will be depends on the profit level (or loss) it achieved. Those making a profit can expect a maximum amount totalling 20% of their production costs, based on either 80% of core expenditure or their EEA spend (whichever figure is lowest).
A 25% tax credit can be claimed on surrendered losses where necessary. It’s calculated based on either the available loss or the eligible expenditure (whichever amount is less).
This is where the guidelines are quite specific. Essentially, in order to be eligible for VGTR a video game must be playable on an electronic video device. This could be a PC or games console, or something portable like a tablet, mobile phone or other handheld machine.
Additionally, the game must allow the player to control what’s going on in the game, either with actions or by controlling events. What the player can do in the game must also have a meaningful outcome.
The claimant of VGTR is usually the company which is most engaged in its development. This doesn’t necessarily have to be the IP holder or the developer, but only one company can receive VGTR per game.
HMRC will then look to ascertain that the company claiming is the most ‘dominant’ one. It will do this by looking at who designed, produced and tested the video game, as well as who directly looks after rights, contracts and negotiations. Additionally, it needs to be clear which company is actively involved in planning the game, and who will test and market it. You can find out more on the VGTR page of the Myriad Associates website.
There’s a broad spectrum of support offered by the government for innovative business involved in the creative sector in particular. As well as the UK Games Fund and VGTR, companies can also benefit from R&D Tax Credits and other R&D Grants for example. But whether your business is eligible and how to apply can be tricky to ascertain, which is why it’s highly recommended you contact R&D tax relief & VGTR specialists such as ourselves.
If you would like to discuss financial support for games development or any other kind of innovation support, feel free to contact the R&D tax experts at Myriad Associates on 0207 118 6045 or use our contact form.