04 February 2017
by Tamara Dumas
Have you ever wondered what makes big film production companies choose to shoot in remote countries? Apart from the obvious – historic reference to the location or a scenic view - there is one more reason. In an effort to create jobs, stimulate local economies and promote tourism, many countries offer production companies lucrative incentives to shoot within their borders. These production incentives vary significantly in structure and scope and the production company is left with a hard choice – there might be some compromises needed, you see.
Each country stipulates unique set of qualifying criteria and anyone willing to put their hands on these funds needs to consider the minimum amount of qualifying local expenditure, local employment regulations, and whether or not the country requires the film to pass a cultural eligibility test.
The most common forms of incentives are:
1. Cash rebates function similarly to grants and are paid to the production company in percentages based on qualifying local expenditures, including labour, production costs, and other services.
2. Tax incentives are similar to rebates, but the production company must file a tax return to claim the funds. In turn, the company will receive a credit for taxes owed on qualifying local expenditures, including labour, production costs, and other services
3. National or regional film funds are limited government-sponsored grants for which a production must specifically apply.
4. Tax shelters, relief, or waivers allow investors tax breaks on their investments.
Below, we've broken down the world's most attractive production incentives.
Best in Eastern Europe
Film commission: Estonian Film Institute
Financial incentive: Up to 30% cash rebate for film productions. There are also hefty sums available for development, pre-production, post-production, and distribution.
Criteria: The amount of aid is calculated as a percentage of the costs endured in Estonia (up to 30%) and paid out retroactively after all the expenses are audited. The maximum grant can be applied if the film production uses Estonian-based filmmakers, actors, and other production crew. It can also be applied if the story is set in Estonia.
Notes: With a proven track record when it comes to commercial production and low costs for crew and equipment, the country is quickly becoming a very attractive location for international film shoots. Better known as homeland of Skype and E-citizenship, Estonia has advanced in IT infrastructure. Great internet connection almost anywhere in the country is a given. Estonia has a climate with prominent four seasons. Snowy winters, spring with the nature slowly turning green and bursting in bloom, summers with white nights - 20 hours of daylight between sunrise and sunset - and colourful autumn months.
Film commission: Hungarian National Film Fund.
Financial incentive: 25% tax incentive on eligible expenses.
Requirements: Must pass a cultural test, but producer is free to spend 20% of production costs outside of Hungary.
Notes: Hungarian film crews are incredibly experienced and professional. There are many high-quality production facilities, and the country is notable for its film-friendly infrastructure.
Film commission: Lithuanian Film Centre.
Financial incentive: Cash rebate of up to 20% of the budget.
Requirements: At least 80% of all production spending must be in Lithuania; maximum amount of funding cannot exceed 20% of the production costs. Similar to Estonia, Lithuania has prominent four seasons. Snowy winters, spring with the nature slowly turning green and bursting in bloom, summers with white nights - 20 hours of daylight between sunrise and sunset - and colourful autumn months.
Film commission: Macedonia Film Agency.
Financial incentive: 20% cash rebate on Macedonian production costs.
Requirements: You must spend a minimum of $113,000, have 50% of funding already in place, and have a Macedonian producer involved.
#5: Czech Republic
Film commission: Czech Film Commission
Financial incentive: 20% rebate on qualifying Czech spending; 66% rebate on international costs paid to foreign above-the-line cast and crew who pay withholding tax in the Czech Republic.
Requirements: Feature films must spend more than $628,000; documentaries must spend more than $83,000. Your production must pass this (relatively easy) cultural test, as well.
Notes: The Czech Republic is a popular destination for film production not only because of its financial incentives but also because of its large number of comprehensive and extremely professional production facilities.
Film commission: Filming in Croatia.
Financial incentive: 20% rebate on qualifying Croatian expenditure.
Requirements: The applicant must be a Croatian producer, co-producer, or production service provider that has produced or provided production services for at least one publicly shown work within the last 3 years.
Film commission: Serbian Film Commission.
Financial incentive: 20% rebate on qualifying Serbian expenditure.
Requirements: $340,000 minimum spend on feature films; $57,000 on docs.
Film commission: Polish Film Institute.
Financial incentive: In February 2017, Poland has introduced film production incentive of up to 25% cash back. Caps on specific productions are still under negotiation, and projects will need to have 50% of their budgets in place before applying. The PFI offers a system of grants that cover up to 50% of production costs. You can obtain additional funding from specific regions, such as the Krakow Regional Film Fund.
Notes: Poland has become an increasingly popular filming destination in recent years. Cold War thriller “Bridge of Spies”, starring tom Hanks, was shot there.
Best in Western Europe
Film commission: Irish Film Commission.
Financial incentive: 32% tax credit on local Irish expenditures.
Requirements: The production company must reside in Ireland, or trade through a branch or agency; not connected to a broadcaster.
Notes: TV shows such as "Game of Thrones," “Vikings,” “Penny Dreadful” and “Ripper Street” have all shot their most recent seasons in Ireland. “Star Wars: The Force Awakens” also features scenes shot on the Emerald Isle, with the same team making a return trip for “Episode VIII.”
#2: The UK and Scotland
Film commission: British Film Commission.
Financial incentive: 25% cash rebate and up to 80% tax relief.
Requirements: Production must pass a cultural test.
Certification and qualification is administered by the British Film Institute (BFI) on behalf of the Department for Culture Media and Sport.
The BFI will issue an interim certificate for uncompleted work or a final certificate where production has finished. If an interim certificate is received, then a final certificate must be applied for on completion. If a final certificate is not received then any interim relief which has already been paid will have to be repaid.
Notes: Britain is Europe’s hotbed for film production. And it’s not just the incentives that make it an attractive place to shoot. The UK has world-class studios spread out over the country, innovative VFX houses and reliable, knowledgeable crews in addition to iconic architecture and recognisable landmarks.
Film commission: Belgian Film Industry.
Financial incentive: The Belgian Tax Shelter allows the finance of up to 45% of Belgian-eligible expenses.
Requirements: Cannot exceed 50% of total production budget. Besides this offering there are also regional funds— such as the Flanders Audiovisual Fund and the Wallimage Investment Fund— available to international and co-productions looking to shoot locally.
Film commission: Film France.
Financial incentive: 30% tax rebate on qualifying expenditures in France.
Requirements: Production must pass a cultural test; minimum spend is either $1.5 million or 50% of total production budget spent in France.
Notes: There are 41 local film commissions throughout France which provide free assistance on issues such as location scouting, finding crew and obtaining filming permits. Films like "Inception" and "Midnight in Paris" were filmed in France.
Film commission: Malta Film Commission.
Financial incentive: 25% cash rebate of eligible expenditure with an additional 2% if the production features Malta culturally.
Requirements: Production must pass a cultural test.
Film commission: Filming in Italy.
Financial incentive: 25% tax relief on qualifying expenditures.
Requirements: Production must pass a cultural test and meet other requirements.
Notes: Films like "Letters to Juliet," "Eat, Pray, Love" and "The Tourist" were filmed in Italy.
Financial incentive: Cash rebate of 20% eligible production costs.
Requirements: You must pass a cultural eligibility test, spend $1.5 million in Austria, and meet various other requirements.
Film commission: German Federal Film Fund (DFFF).
Financial incentive: In recent years, Germany has significantly slashed its federal film funding, from $95 million to the current $68 million. The DFFF offers a grant that covers 20% of German production costs with a maximum grant limit of $4.5 million (and $11 million in exceptional cases). Germany also has 17 regional film commissions to help with production logistics and funds.
Requirements: Feature films must pass a cultural eligibility test, have an office registered in Germany, spend 25% of production costs in the country, have 75% of financing in place, and meet other requirements.
Notes: Big-budget films such as The Grand Budapest Hotel, The Monuments Men, Cloud Atlas, and Inglourious Basterds have been awarded the grant.
Best in Scandinavia
Film commission: Film in Iceland.
Financial incentive: 25% cash rebate on all eligible expenses.
Requirements: Must submit a relatively simple production plan. Those choosing the country for filming can take advantage of straightforward legislation; by setting up a local production company, audiovisual productions can see a return of 20% of their total local expenditure.
Notes: Iceland has had its fair share of TV and film coverage lately and its well-organised crew and production services industry seems to keep attracting big-budget productions. Titles that have benefited from this offer include The Secret Life of Walter Mitty and Game of Thrones.
Film commission: Norwegian Film Institute.
Financial incentive: 25% cash rebate on all eligible expenses.
Requirements: Minimum production spend of $3 million and must pass qualification test.
Best in Asia
Film commission: Media Development Authority of Singapore.
Financial incentive: In 2004, the Singapore Tourism Board introduced the "Film in Singapore Scheme," which promotes production in the country by subsidizing up to 50% of qualifying expenses incurred in Singapore, including local talent, production staff, and production services. Additionally, there are various grants available through the MDAS, including a "Production Assistance" grant that supports up to 40% of qualifying expenses.
Requirements: Films and television shows must portray Singapore in a favourable light.
Film commission: National Film Development Corporation Malaysia.
Financial incentive: 30% cash rebate in qualifying local expenditure.
Requirements: $1.2 million minimum spend (including post-production).
Best in Oceania
Film commission: Film Fiji.
Financial incentive: Film Fiji offers a whopping 47% tax rebate on production spend in the country.
Requirements: The production company must be locally registered in Fiji; in addition, you must demonstrate an ability to release and distribute the film in a major international market.
Financial incentive: Producer Offset (40% rebate on productions shot in Australia); PDV Offset (30% rebate on post-production work conducted in Australia, regardless of where the production was shot).
Requirements: To qualify for the Producer Offset, you must have an agreement for an Australian theatrical release, a financial commitment towards prints and advertising made by the distributor, an international sales agent attached, and more.
#3: New Zealand
Film commission: New Zealand Film Commission.
Financial incentive: The New Zealand Screen Production Grant offers a 20% cash rebate to qualifying expenditures; you can also qualify for an additional 5% uplift if your project meets requirements proving it will boost the country's economy.
Requirements: $11 million minimum spend for feature films; more requirements here.
Notes: New Zealand is a very popular place for scenic shots. Titles like "Lord of The Ring", 'The Hobbit", "Narnia", and "Last Samurai" have New Zealand in their credits.
Best in North America
Financial incentive: Depending on the province, producers can access combined federal and provincial tax credits ranging from 32% to 70% of eligible labour, as well as tax incentives on local qualifying spend ranging from 20% to 30%.
Requirements: Varies depending on province.
Note: Thanks to the lucrative incentives, a lot of American films were shot in Canada. Among them are Titanic, Twilight, Mean Girls, Blades of Glory, Catch me If You Can and The Day After Tomorrow among others.
#2: United States of America.
Financial incentive: Depending on the state, producers can access tax credits ranging from 25% to 35%.
Requirements: varies depending on province
Best in Latin America & Caribbean
#1 : Colombia
Film commission: Colombia Film Fund.
Financial incentive: Two-tier cash rebate system provides 40% for film services (including services related to post-production, artistic, and technical services), and another 20% for film logistical services (including services provided for transport, accommodation, and food).
Requirements: Production must be partially or totally filmed in Colombia, with a minimum $600,000 local spend.
Notes: Medellin is the only city in Colombia that offers rebates in addition to the above incentives; you can receive up to 15% of production spend in the city.
#2: Trinidad & Tobago
Film commission: Trinidad & Tobago Film Company.
Financial incentive: Cash rebates up to 55% for expenditures on qualifying local labour and 35% on other local expenditures.
Requirements: At least 50% of the principal photography must be done in Trinidad and Tobago; minimum of two weeks of the principal photography must be filmed in Trinidad and Tobago.
#3: Puerto Rico
Film commission: Film in Puerto Rico.
Financial incentive: 40% production tax credit on all payments to Puerto Rico resident companies and individuals.
Requirements: $100,000 minimum spend.
#4: Dominican Republic
Film commission: Dominican Republic Film Commission.
Financial incentive: 25% transferable tax credit on all eligible expenditures including pre-production, production, and post-production.
Requirements: $500,000 minimum spend.
Best in the Middle East
#1: United Arab Emirates
Film commission: Abu Dhabi Film Commission.
Financial incentive: 30% cash rebate on production spend; no sales tax.
Requirements: Must pass the National Media Council content clearance.
Best in Africa
#1: South Africa
Film commission: National and Film and Video Foundation, Trade and Industry Department of South Africa.
Financial incentive: 20% tax credit (production), 25% tax credit (post-production).
Requirements: 100% of the filming must be done in South Africa, and there is a $1.5 million minimum spend.
Notes: There are lucrative regional film funds in Gauteng, Cape Town, Durban, and the Eastern Cape
Hungarian Parlament | Credit: pixabay
Film The Summer of Sangaile, shot in Lithuania
Shooting of The Aftermath in Prague, Czech Republic
Game of Thrones was filmed in Dubrovnik, Croatia
Bridge of Spies”film was shot in Poland | Courtesy of Dinsey
Game of Thrones filmed in Ireland | Courtesy of Sky Atlantic
Harry Potter was filmed in UK | Courtesy of Warner Bros
The White Queen was shot in Bruges, Belgium | Courtesy of BBC
Inception was filmed in Paris, France | Courtesy of Warner Bros
The Tourist was filmed in Venice, Italy | Courtesy of GK Films
The Grand Budapest Hotel benefitted from the grant | Courtesy of Fox Searchlight Pictures
The Secret Life of Walter Mitty | Courtesy of Twentieth Century Fox
Girl With The Dragon Tattoo was filmed in Norway | Courtesy of Columbia Pictures
Hitman: Agent 47 shot in Singapore | Courtesy of Twentieth Century Fox
Cast Away with Tom Hanks was shot in Fiji| Courtesy of Twentieth Century Fox
The Great Gatsby was filmed in Australia | Courtesy of Warner Bros
The Lord of The Ring was filmed in New Zealand | Courtesy of New Line Cinema
Twilight shot in Canada | Courtesy of Summit Entertainment
Shutter Island shot in Massachusetts, US | Courtesy of Paramount Pictures
Tropico de Sangre was shot in Dominican Republic
Play the Devil was shot in Trinidad and Tobago
Star Wars Episode VII – The Force Awakens shot in UAE | Courtesy of Lucasfilm