Following the earlier introduction of cash rebates and an enhanced tax regime for film producers, at the end of August 2020 Ukraine made the final step towards a cash rebate incentive for foreign film producers by implementing an application procedure for rebates.
Generally, cash rebate incentives allow foreign filmmakers to receive compensation for production costs incurred in Ukraine in an amount varying between 4.5% and 25% of eligible expenses, which include direct production expenses such as employee salaries. The exact amount of the rebate will depend on certain criteria and the type of expenses incurred by foreign producers.
According to the new rebate procedure, the application process involves two submissions to the regulator:
- application for preliminary conclusion regarding passing by a film of a ‘cultural test’ prior to completion of the film’s production; and
- application for a conclusion that the film passed the ‘cultural test’ within one year since the date of completion of the film’s production.
In order for a film to be able to qualify for the cash rebate incentive, a foreign producer must enter into an agreement for part or all of the production with a Ukrainian production company (i.e. a service agreement related to organising the film’s production).
For more details on the requirements for applying for the cash rebate incentive in Ukraine, contact your regular CMS advisor or local CMS experts Olga Belyakova, Viktoriia Stavchuk.