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CTFs get top-up

The Chancellor’s pre-Budget report introduced measures to end abuse of tax relief for UK film production. The Treasury says the move, which takes immediate effect, is designed to ensure that the reliefs operate as intended.

The rules prevent accelerated relief for qualifying British films
being claimed more than once on any film – a process known as
double-dipping.

Structures which use film relief to defer tax beyond 15 years will be
banned and partnerships will be prohibited from getting loss relief
for money not really at risk.

The Government will consult with the UK Film Council and the industry
in a review of the tax relief used by big-budget films.

A Treasury spokesman says: “The Government appreciates the need for
certainty, given the long lead times for film production. The review
will be taken forward on a short timescale to the end of January
2005.”

The Government has pledged to make additional payments into child
trust fund accounts when children reach the age of seven.

A payment of 250 will be made, with 500 going to the
poorest families. Eligibility will be measured in the same way as for
the initial payment and the payment will be made automatically with
no need to claim.

The Treasury has asked for industry feedback on whether the amount is
enough. The Chancellor estimates around 40 per cent of children will
get the higher payment.

F&C and Nationwide say the additional payment will help to drive
interest in the product.

AITC communications director Annabel Brodie-Smith says: “For maximum
benefit, the child trust fund must be linked to financial education.
Top-ups at seven would provide an ideal opportunity for children and
parents to learn about investing through hands-on experience and
would have wider long-term benefits than the monetary value.”

Nationwide spokeswoman Rosemary Callender says: “We welcome any
consultation on the amounts but however much the Government
contributes, we intend to be a major player in the CTF market and
will offer both cash and equity versions.”

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