UK video game tax relief hinges on passing this 'cultural test'
The UK government outlined a "cultural test" that video games developed in the region must meet for the studio to qualify for tax relief, as part of the industry overhaul begun earlier this year. A game must earn 16 points to receive the tax break, with points awarded for such criteria as being "set in the United Kingdom or another EEA state," which includes all countries of the European Union, plus Iceland, Liechtenstein and Norway. The studio gets four points if the game stars two of three lead characters "from the United Kingdom or another EEA state or from an undetermined location," or it depicts "a British story."

If at least half of the game's development is completed in the UK, studios can earn three points, while a "qualifying" project leader, script writer, composer, artist, programmer, designer and department head earn one point each. If at least half of the entire team qualifies as a legitimate UK operation, the studio gets another point. The tax code is like a game in itself.

For example, if a studio in the UK (3 points) with all local staff (8 points) creates a game about a time-traveling doctor in a bowtie (4 points) as he journeys around Liverpool (4 points), Hufflepuff wins the House Cup. See? Easy.

Peruse the entire cultural test below.
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(1) A video game may be certified as a British video game under section 1217CB(1) of the Act only if it passes the following cultural test.

(2) A video game passes the cultural test if it is awarded at least 16 points in total under paragraphs (3) to (6).

(3) Up to 16 points shall be awarded in respect of the content of the video game as follows-

(A) Up to 4 points depending on the percentage of the video game that is set in the following locations

(i) 4 points if at least 75% is set in the United Kingdom or another EEA state;
(ii) 3 points if at least 66% is set in the United Kingdom or another EEA state or set in an undetermined location;
(iii) 2 points if at least 50% is set in the United Kingdom or another EEA state or set in an undetermined location;
(iv) 1 point if at least 25% is set in the United Kingdom or another EEA state or set in an undetermined location;

(B) Up to 4 points depending on the number of the characters depicted in the video game with the following characteristics

(i) if there are more than three characters depicted in the video game, 4 points if two or three of the three lead characters are from the United Kingdom or another EEA state or from an undetermined location or, if only one of the three lead characters is from the United Kingdom or another EEA state or from an undetermined location, 2 points if that character is the first or second lead, 1 point if that character is the third lead;
(ii) if there are only three characters depicted in the video game, 4 points if two or three of them are from the United Kingdom or another EEA state or from an undetermined location or, if only one of them is from the United Kingdom or another EEA state or from an undetermined location, 2 points if that character is the first or second lead, 1 point if that character is the third lead;
(iii) if there are only two characters depicted in the video game, 4 points if both of them are from the United Kingdom or another EEA state or from an undetermined location, 2 points if one of them is;
(iv) if there is only one character depicted in the video game, 4 points if that character is from the United Kingdom or another EEA state or from an undetermined location;

(C) 4 points if the video game depicts a British story or a story which relates to an EEA state;

(D) up to 4 points depending on the percentage of the original dialogue that is recorded in the English language or in a recognised regional or minority language as follows

(i) 4 points for at least 75%; (ii) 3 points for at least 66%; (iii) 2 points for at least 50%;
(iv) 1 point for at least 25%.
(4) Up to 4 points may be awarded in respect of the contribution of the video game to the promotion, development and enhancement of British culture.

(5) Up to 3 points shall be awarded in respect of work carried out in the making of the video game as follows

(a) 2 points if at least 50% of the work carried out on any of the following is carried out in the United Kingdom

(i) conceptual development; (ii) layout and storyboarding;
(iii) programming;
(iv) visual design;
(b) 1 point if at least 50% of the work carried out on any of the following is carried out in the United Kingdom
(i) performing and recording the music score created for the video game;
(ii) voice recording;
(iii) audio production;
(iv) picture production.

(6) Up to 8 points shall be awarded in respect of the personnel involved in the making of the video game as follows

(a) 1 point if the project leader (or, if there is more than one, the main project leader) is a qualifying person;
(b) 1 point if at least one of the scriptwriters (or, if there are more than three, one of the three lead scriptwriters) is a qualifying person;
(c) 1 point if the composer (or, if there is more than one, the lead composer) is a qualifying person;
(d) 1 point if the artist (or, if there is more than one, the lead artist) is a qualifying person;
(e) 1 point if the programmer (or, if there is more than one, the lead programmer) is a qualifying person;
(f) 1 point if the designer (or, if there is more than one, the lead designer) is a qualifying person;
(g) 1 point if at least one of the heads of department is a qualifying person;
(h) 1 point if at least 50% of the development team are qualifying persons.

This article was originally published on Joystiq.

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