Games seeking UK tax breaks must pass points-based test

Whether a game qualifies for UK tax breaks will be determined by a points-based test that focuses on its cultural content and contribution. Projects will need more than half marks (at least 16 out of 30) to qualify.

The government's initial draft - on which UK trade body UKIE has now commented - is heavily based on a similar test for the UK film industry.

Between one and four points will be awarded for the amount of a game set in the UK, and up to the same amount again for the number of lead British characters.

This may be an obstacle to more "abstract games", UKIE notes, citing puzzle games such as Tetris. In that case, points should be awarded for a setting or nationality that "cannot be determined".

"Games will not always have a traditional narrative, describable setting, or characters of a recognisable species," UKIE's response explained. "UKIE therefore welcomes the government's proposal to recognise fictional settings and species."

Points will also be awarded for a British or European narrative structure, but again this has difficulties for the games industry.

"Clarity should be provided as to what narrative structure represents, and how such a structure can be British or European," UKIE notes. "Narrative structure is not an applicable concept for many games.

"For example, one of the biggest-selling UK games franchises is Football Manager, which is based on the Championship Manager game created by the Collyer brothers in 1992. We believe that this would clearly qualify for four points [full marks]."

A later section affords points for creative costs, for example assembling a team top notch developer team whose salaries cost more than 50 per cent of the game's total budget.

UKIE instead suggests more emphasis be placed on the core programming staff instead, and notes that the government's wording of the test is far from original.

"We note that the wording of this test is taken directly from the English translation of the cultural test used for the French games tax relief. Whilst this offers an advantage in that it has already been approved by the European Commission, we do not feel that it accurately reflects the creative costs involved in a game and may again have its origin in a film industry test."

It has yet to be determined who will operate the test when it is finalised. The British Film Institute was the government's suggestion, although UKIE has said it would prefer an independent body, composed solely of games industry experts. This would negate any suggestion that games were not a creative industry in its own right, it said.

The government finally confirmed a tax break scheme for the UK games industry in March after a long-fought battle. The system is due to go live in April next year.