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Museums and Galleries Exhibition Tax Relief

Jul 5, 2019 | Blogs

This is the latest in the tax reliefs introduced as a means of supporting the creative industries.  The measures were introduced by the Finance (No2) Act 2017 and HMRC issued the manual setting out the mechanics of making a claim in 2018.


This relief represents a progression in the sort of support available for specific types of activity.  The technical structure set out in Film tax relief (and the associated reliefs relating to animation, high-end television, children’s television and video games) was followed for Theatre Tax Relief (TTR) and Orchestra Tax Relief (OTR) and is followed here.


OTR complements TTR in that both cover qualifying live performances – TTR covers qualifying dramatic productions and OTR covers qualifying concerts.  These reliefs will not apply to the same live performances.  The origin of TTR was to provide support to the commercial theatre sector though care went into ensuring that the subsidised sector could also benefit.  OTR does not just apply to orchestras but also to any performing group which has 12 or more instrumentalists so long as only a minority are ‘electronically or directly amplified’ – the aim being to exclude rock and pop concerts and allow other types of concerts such as by brass bands.


Museums and Galleries Exhibition Tax Relief (MGR) is conceived on a different basis in that a museum or gallery must be involved and that the museum or gallery must be maintained by a charity or a Local Authority.  Museums and galleries are not defined as such – the key requirement is that the exhibition is a curated public display.  It is clarified that a library or archive can be treated as a museum or gallery, as can outdoor collections or works.


The mechanism for claiming the tax relief is the same as for the other reliefs in that the entity needs to be subject to corporation tax regardless of whether it actually pays tax.  Charities limited by guarantee and CIOs can claim but not unincorporated trusts or associations or partnerships.  If in doubt an organisation can set up a limited company to make the claim so long as the other requirements are satisfied.


As with TTR there are different rates of tax credit depending on whether the exhibition is a touring exhibition or housed in one venue.  Where there is a touring exhibition, one company can claim for the tour as a whole there can be separate claims made by the venues for costs at that venue – on the basis that there is no double claiming for costs.


Claims for MGR are made after the end of the financial year and after submission of the corporation tax return of the company making the claim.  Those charities who have tended not to submit corporation tax returns on the basis that all their trades are primary-purpose trades (and therefore tax exempt) will need to submit a return if they are making an MGR claim.  Claims are submitted on an exhibition by exhibition basis and the amount of a successful claim is a cash payment made by HMRC.


The amount of a claim is based on 80% of qualifying expenditure – the rates are 20% for non-touring exhibitions and 25% for touring exhibitions (so this equates to a net rate of 16% for non-touring and 20% for touring exhibitions) subject to the exhibition making no ‘profit’.  The vast majority of exhibitions will not make a profit but for those who may, it is advisable for the museum or gallery which is organising the exhibition to consider whether to use a subsidiary to deliver the exhibition as a means of maximising the MGR claim – this is a structure HMRC accepts.


There is no specified format for making a claim and, like TTR and OTR claims, can be in the form of a covering letter and an excel spreadsheet including all the relevant information. 


As with the other cultural industries reliefs, MGR should prove a worthwhile additional source of income.  It is flexible and user-friendly, though there are particular issues that potential claimants will need to consider, particular as they get used to making claims.



Sean Egan is a lawyer with over 25 years’ experience working for Arts and Media clients and advised a wide range of clients on Theatre Tax Relief


Sean Egan Consultants Limited / 07879 228221


July 2019




The content of this article is intended for general guidance only, specific advice should be taken for specific situations . No responsibility for loss by any person acting or refraining from action as a result of this article can be accepted. We cannot assume legal liability for any errors or admissions this article may contain.




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