Orchestra Tax relief overview: What it is, who can benefit and how we can help

Orchestra Tax Relief (OTR) is a state aid tax reliefs for the creative industries. OTR incentivises the production of orchestral concerts – and amateur orchestras are specifically referenced in the legislation.

We have been running our OTR service for over a year now and our groups have already been receiving payments from HMRC. However we believe that many more instrumental leisure-time music groups across the UK could take advantage of OTR, and your group could be one of them. 

  • Despite being called 'Orchestra Tax Relief', the relief can apply to many types of instrumental group – so don’t be put off if your group is not a traditional orchestra 
  • Although there are costs and admin time involved in claiming OTR, we think even for smaller groups these will be outweighed by the financial gains (see below for some sample figures)

Why is it so great?

Lots of reasons – we think two of the biggest are:

  • No cultural test:  OTR is not dependent on what is being performed, who the audiences are, how technically able the musicians are or how modern the composer. It is simply money to encourage putting on concerts.
  • It’s there every year – if you do concerts that qualify every year, you can claim every year

"We are delighted to have just received our first payment from HMRC for Orchestra Tax Relief. We worked closely with Making Music on this- they provided us with training at the start of the process and hand-holding throughout. Hopefully, many other amateur orchestras will also take advantage of this welcome governmental support to amateur music."

David Smith, Ealing Symphony Orchestra

How do we find out more?

We have provided some detailed guidance, template documents and services to help guide your through OTR from start to finish. Briefly, here are some of the key facts.

Who can claim?

If your group plays concerts featuring 12 or more instrumentalists who are the main focus of the concert, then you can potentially claim OTR.

How much money do we get?  

This will vary from group to group, but of the claims submitted so far the average OTR payment received has been 15% of the total concert budget. Some examples of claims we have submitted so far shown in the table below. 

Total concert budget for a year OTR payment
£ 31K £4.6K
£11.3K £1.6K
£14.6K £2.3K
£6.2K £1K (payment pending)

How do we claim?

The claim process will involve a bit of work and some changes to how you operate – but we can provide lots of help along the way. You will need to read our detailed guidance (see below) to fully understand how it works, but at the most basic level it involves:

  • Your group setting up a limited company and sub-contracting concert production activities to that company
  • At the end of its financial year, the production company completes its accounts and makes the OTR claim to HMRC in the form of a tax return.

How can Making Music help?

We have broken our resources into three sections - containing guidance, templates, toolkits and services to help take guide you through from deciding if OTR is for you to actually making a claim.

OTR, Part 1: Helping you decide – free to members

OTR, Part 2: Setting up (the nuts and bolts)  free to members

Toolkit: setting up a production company

  • Guidance: Setting up a Production Company
  • Template: Memorandum & Articles of Association
  • Template: Declaration of Trust
  • Guidance: Completing form IN01

Toolkit: running a production company

  • Guidance: Running a Production Company
  • Template: Agreement between Parent Organisation & Production Company
  • Guidance: Notes to accompany the agreement
  • Guidance: Making an Election to HMRC
  • Sample: Timeline for an OTR year
  • Template: Transfer of Stock

OTR, Part 3: Keeping records, producing accounts and making a claim

Services:

1.    Support for producing statutory annual accounts for your production company. There is a fee for this service:

  • £125 + VAT for member groups below £31k income
  • £250 + VAT for member groups £31k-£100k income

2.    Company Tax return and OTR claim submission: submission of Company Tax return and OTR claim on your behalf. There is also a fee for this service

  • £125 + VAT for member groups below £31k income
  • £250 + VAT for member groups £31k-£100k income

We hope you find this Making Music resource useful. If you have any comments or suggestions about the guidance please contact us. Whilst every effort is made to ensure that the content of this guidance is accurate and up to date, Making Music do not warrant, nor accept any liability or responsibility for the completeness or accuracy of the content, or for any loss which may arise from reliance on the information contained in it.