Finance Act 2016 introduced the new Orchestra Tax relief with effect from 1 April 2016.  This relief applies for Corporation Tax.

There are a number of changes from the original proposals and those set out following the consultation process.

Key changes from the original consultation document

  • The number of players required has been reduced from 14 to 12.
  • Originally all four of the main instrument groups needed to be represented. The Finance Act does not refer to any instrument groups but requires that most of the instruments used are not directly or electronically amplified.
  • The original proposals restricted orchestras in terms of the type of music used in the performance, for example, no use of rock or pop music was allowed, but this restriction is not included in the Finance Act.
  • No distinction is made in the Finance Act between touring and static performances.

Key features of orchestra tax relief

  • Qualifying companies must be engaged in the production of live orchestral performances.
  • Tax relief is given in respect of the creative and production costs incurred in producing live orchestral performances or commissioning new musical work. Rehearsal costs are included but performance costs are not.
  • No distinction is made between touring and non-touring performances.
  • Orchestras can group together a series of qualifying performances in one tax relief claim.

How much relief? 

Qualifying companies can claim either: 

  • An additional tax deduction (the enhancement) of 100% of expenditure, which is the lesser of
    • UK qualifying expenditure or 
    • 80% of total qualifying expenditure, or
  • If after claiming enhanced deduction of expenditure the company makes a loss it may surrender the lower of that loss or the qualifying enhanced expenditure and be repaid a tax credit claim amounting to 25% of the loss.
  • The maximum relief available per company is €50 million.

What’s new?

HMRC have included guidance relating to the impact of furlough payments during the COVID-19 pandemic, including those met by the Government through the Coronavirus Job Retention Scheme (CJRS), at OTR60120.

Definition of an orchestral performance

  • There must be at least twelve instrumentalists.
  • A minority of the instruments can be electronically or directly amplified.
  • Players in the orchestra must be the primary focus of each performance.
  • The performance should be for paying members of the general public or for educational purposes.
  • Each performance must be live with the players actually present before their audience.


  • The main purpose or one of the main purposes of the performance is to advertise or promote any goods or services.
  • The main object or one of the main objects of the performance is the making of a relevant recording or broadcast.
  • Performances consisting of or including competition or contest.

Where a company claims orchestra tax relief, it will not be able to claim relief under another tax credit scheme such as film tax relief, theatre tax relief or the research and development tax credit.

Any amount of costs incurred but unpaid within four months of the end of a period of account will not qualify for the tax relief for that period.

Qualifying companies

The company must be within the charge to UK Corporation Tax and be the production company for the concert.

This means that the company must:

  • Be directly involved in the development of an orchestra's performance, making effective creative, technical and artistic contributions.
  • Be actively involved in the decision-making process to deliver the performance.
  • Be responsible for employing or engaging the performers.
  • Directly negotiate for, contract for and pay for rights, ­goods and services in relation to the concert.

There can be only one production company in relation to a concert.

HMRC has confirmed that charities will not be excluded from this relief even if they do not pay Corporation Tax: they may claim the repayable credit.

Some orchestras may choose to use a wholly-owned trading subsidiary in order to claim tax relief. 

Qualifying expenditure

The company's expenditure must be directly incurred in the creation and development of an orchestral performance and must be integral to the creative process. 

The list below sets out some examples of the eligible and ineligible costs. In addition, the following are excluded from relief:

  • Indirect expenditure, such as the costs of marketing or financing.
  • Speculative expenditure and ordinary running costs.
  • Costs which have also qualified for R&D relief.

Qualifying expenditure can be incurred in any country, although at least 25% of the core expenditure must be incurred in the European Economic Area.

Examples of core expenditure

Qualifying ‘core’ expenditure:

  • Player and artist fees.
  • Rehearsal costs.
  • Venue hire for rehearsals.
  • Hire or commissioning of musical scores.
  • Relevant travel and subsistence within the UK.

Ineligible costs:

  • Performance costs.
  • Cost of financing.
  • Fees, including legal and accounting fees.
  • Administration.
  • Marketing and advertising.
  • Overseas travel and subsistence.

Claiming for a series of concerts

  • There must be two or more orchestral concerts.
  • All, or a high proportion of concerts, must be qualifying orchestral performances.
  • The company must be the production company in relation to every concert in the series.
  • All or a high proportion of concerts must be performed live, either for the paying public or for educational purposes.
  • The EEA expenditure condition must be met in relation to the series.
  • The company must make an election before the date of the first concert to treat the concerts as a series.

Small print and links

Also see our guide to Creative Industries Tax Reliefs.

HMRC's Orchestra Tax Relief manual

HMRC’s consultation documents for Orchestra Tax Relief, including the consultation outcome.

Legislation is included in the 2016 Finance Act at section 54 and schedule 8.


16 January 2017 minor amends and additions following review

19 September 2016 updated for Finance Act 2016 receiving Royal Assent.

12 April 2016 updated to reference the 2016 Finance Bill published in March 2016.

16 December 2015 updated following the publication of draft legislation in the 2016 Finance Bill.

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