Audiovisual and film tax credit: rates, eligible expenses and CNC approval

Quick answer. The audiovisual tax credit (CGI art. 220 sexies) is reserved for delegated production companies making approved works and subject to corporate income tax. It amounts to 25 % of eligible expenses incurred in France for fiction, animation and documentary, and 10 % for other works. Key ceiling: public aid, including the credit, may not exceed 50 % of the final production cost (60 % for difficult or low-budget works).

You are setting up a series, a documentary or an animation programme, and the tax credit already appears in your financing plan. The real challenge is not knowing the rate: it is securing the base, the timing of approval and the stacking of aid so that the credit you announce is the one you actually collect. In our production files, the gap between a comfortable credit and a trimmed one almost always comes from choices made upstream, not from a calculation error.

The scheme aims to keep and relocate the making of programmes in France: writing, shooting, technical work, post-production. It targets the delegated production company, namely the one that takes the financial, legal and artistic initiative and responsibility for the work and guarantees its completion. An executive production company or a mere service provider does not qualify in its own name.

Two structuring conditions govern access to the scheme:

• the company must be subject to corporate income tax;
• the work must obtain approval from the CNC (Centre national du cinéma et de l'image animée).

In our practice, the audiovisual tax credit is rarely an isolated topic. It interacts with the financing plan, broadcaster contributions, CNC support and, where relevant, the international tax credit. It is this interaction, more than the headline rate, that wins or loses cash.

The rate depends on the genre of the work. Here is the reading we apply to the audiovisual credit.

The rate applies to the base of eligible expenses, not to the total budget of the work. A production may therefore show a large budget without the whole of it qualifying. This often surprises producers on a first project: they reason as a percentage of the overall budget, whereas only the share of eligible expenses incurred in France enters the calculation.

Territoriality is the heart of the scheme. The credit covers operations and services carried out in France, including:

• payments to authors within the meaning of article L113-7 of the intellectual property code, together with the related social contributions;
• the salaries and social contributions of technicians and production staff;
• production expenses (shooting, sets, costumes, equipment, post-production) incurred with providers established in France.

The underestimated risk almost always concerns the traceability of territoriality. An expense invoiced by a French provider but performed abroad, or a rough allocation of cost items, weakens the base. We recommend structuring analytical tracking from the start of the project, item by item, rather than rebuilding the base after the fact, once the invoices have been booked in bulk.

Hayot Expertise tip. Open an analytical code per major item (authors, set, post-production, sets) from the very first invoice. On the day of final approval, you justify the base in minutes instead of re-allocating hundreds of entries under pressure.

The credit requires approval from the CNC, granted in two stages, after selection by a panel of experts.

1. Provisional approval: it confirms the eligibility of the project upstream, before or at the start of production.
2. Final approval: it follows completion, on review of the expenses actually incurred.

A decisive point: expenses qualify for the credit only from the receipt of the provisional approval request by the president of the CNC. Incurring significant expenses before that filing effectively removes them from the base. It is the most costly mistake we see on poorly timed projects: advanced development, first shoots, then a late filing that strips part of the already-spent base from the credit.

The tax credit does not combine without limit with other support. The total amount of public aid granted to an audiovisual production, including the tax credit, may not exceed 50 % of the final production cost. This ceiling rises to 60 % for difficult or low-budget works.

In practice, this ceiling drives the financing plan. Stacking regional aid, CNC grants and the tax credit without simulating the ceiling exposes the producer to a clawback at review. We compute this ceiling at the forecast stage, not at closing: it is the only way to know, before signing the aid agreements, how much room actually remains.

The same article 220 sexies also hosts a film tax credit, with its own regime, featuring a standard rate and an increased rate depending on the characteristics of the work. We do not detail it here so as not to mix two distinct schedules. If you combine a feature film and an audiovisual spin-off, the analysis is run work by work, because each falls under its own regime and its own approval.

In addition, the international tax credit, the C2I (CGI art. 220 quaterdecies), targets foreign productions filmed in France. An international production locating part of its making on French territory may, depending on its structure, fall under this scheme rather than the audiovisual credit. The choice between regimes deserves a case-by-case analysis: the same shoot in France is not treated the same way depending on whether the work is carried by a French delegated producer or by a foreign production company through a host company.

A few configurations come up regularly and call for specific framing:

• International co-production. The split of expenses between co-producers conditions the French base. The sharing of rights and the location of services must be consistent with the co-production contracts.
• Transmedia or multi-format work. A single brand declined into film, series and video game falls under different regimes. On the studio side, the choice plays out between sector credits and research schemes.
• Low-budget programme. The increased 60 % ceiling can change the balance of the financing plan, provided the difficult or low-budget nature of the work is documented.
• Broadcaster joining late. A broadcaster contribution arriving after the provisional approval filing changes the final cost and therefore the ceiling calculation. It must be brought back into the simulation.

• The base cannot be rebuilt after the fact without loss: analytical tracking must precede the first heavy expense.
• The timing of provisional approval is a point of no return for expenses incurred before it is filed.
• The public-aid ceiling is computed on the final cost, which keeps changing until production ends.
• Delegated-producer status and liability to corporate income tax must be established without ambiguity before claiming the credit.

On a recent production company file handled by the firm, the producer had incurred a substantial part of the development and early scouting expenses before finalising the provisional approval request. The project was solid and the genre eligible for the 25 % rate, but a fraction of the expenses was, by construction, outside the base because it predated the receipt of the request by the CNC. The expected credit and the computable credit were not the same figure.

Our reading is clear: on the audiovisual tax credit, the added value of a firm is not measured by knowledge of the rate, which is public, but by mastery of sequencing and traceability. Filing provisional approval at the right time, isolating French expenses in analytical accounting from the first euro, and simulating the public-aid ceiling on a realistic final cost are often worth more, in cash terms, than any last-minute optimisation. That is also why we treat the tax credit as a component of the overall financing plan, not as an isolated line to complete when filing the tax return.

• Confirm the company's status as delegated producer and its liability to corporate income tax.
• File the provisional approval request before incurring heavy expenses.
• Isolate expenses incurred in France from the outset in a dedicated analytical track.
• Document the territoriality of each item (place of performance, provider establishment).
• Simulate the public-aid ceiling (50 % or 60 %) on the estimated final cost.
• Consider the C2I option for international co-productions.
• Prepare the final approval in line with the expenses actually incurred.

On these files, our role is to secure the base and the timetable as much as to compute the credit. If you are structuring a production, our support for audiovisual production helps you align the tax credit, CNC approval and financing plan, alongside our innovation funding offer for CIR, CII and JEI where the project also draws on research schemes. For the overall tax angle, our corporate tax team in Paris frames how the credit is offset and reported. This article is for information; a decision taking account of your specific project requires a review of your situation, your contracts and the rules in force.