Italy offers many different incentives for feature films, documentaries and TV series productions. Commercial productions are not eligible.
Don’t worry about taxes! As Italian production company we will pay the VAT and not charge it to you. The Italian system has a standard 22% taxation over goods & services and a 10% over transportation, hotels & restaurants, all of which you can forget about if you go with a local production service.
INTERNAL TAX CREDIT
The tax credit is not automatic: not every project can access to it, and therefore it is important to establish the possibilities with an expert consultant before starting the whole ministerial process. The process to obtain the ministerial credit is long, but we have the expertise to handle it marvelously.
There are two phases of application: in the first one, once the Ministry has received the documentation from the Italian production company, it determines if the project is eligible for the tax credit; in the second one it determines the monetary value that can be recognized to the project. After the second phase is finished, the Italian production company can start using the credit to pay all picture-related Italian tax liabilities and therefore save on production costs.
Our team can answer to specific questions regarding how the Italian tax credit works, including: consultation on the possibility of obtaining the credit by analyzing the single project, processing times and all the necessary costs to fulfill both the phases.
EXTERNAL TAX CREDIT
To encourage investment in the film industry, there is also a tax credit of 20% for Italian companies outside the industry, which can arrive up to 40% if the film obtains a fund from the state as well. This specific possibility requires that the local film company is involved in development of the project, the sooner the better.
Eligibility for both tax credits is subject to approval by the Italian Ministry of Cultural Heritage, MIC.
FUS – Unique Fund for Performing Arts
The government provides direct funding for projects it determines a priority, following a study of the script, writers, actors, Italian talent, historical & cultural interest, and more. Funding is both for the development stage and the production of the project, and it can be asked by production companies which detain partial rights of the film.
The evaluation process usually requires that a producer seeking this funding applies at least one year in advance.
REGIONAL FUNDS / FILM COMMISSION FUNDS
Each Italian region publishes a fund with specific budget for films, documentaries and TV series every year.
Criteria determining eligible costs and the type of assistance vary from region to region and can be either confirmed or modified each year. It is necessary to have the documentation ready at least six months before the application to the fund, therefore the application needs to be considered long before the starting of the project.
A cash rebate of up to 40% of all eligible costs is available to qualifying productions that are all or partially produced in Malta. Feature films, Television films, TV Series or Mini-Series, Animation, Creative documentary, Virtual Reality/Trans-media/Cross-media, Reality programme (scripted/unscripted) and Game Shows are all eligible for a cash rebate based on a cultural test to determine the percentage rebate.
The minimum spend in Malta is €100K with an overall budget exceeding €200K. Eligible expenditure in Malta shall never exceed 80% of the overall production budget.
A cash rebate on eligible expenditure of ATL costs is capped at €1,000,000 or 30% of Malta eligible spend – whichever is higher up to a maximum of €5,000,000. There is no cap on eligible BTL costs which include accommodation, air travel, EU labour costs, per diems, location fees and all rentals amongst others.
For pre-approval of the cash rebate, foreign producers must apply with a locally registered production service company at least 60 days prior to commencement of principal photography. The cash rebate is returned to the qualifying production within 5 months of final audit submission to the Film Commission.
Tell us more about your project so we can help determine how to best take advantage of the incentives now available in Italy.
Contact us and we will be happy to help!