So, they don’t actually pay corporation tax, they’re a non-profit, but they can claim corporation tax credits.
It has taken advantage of a decision by George Osborne in 2012 to allow cuts in corporation tax to high-cost British-made dramas, comedies and animation, in an attempt to increase filmmaking in the UK.
Independently-produced programmes, or those made by BBC Worldwide, which is the BBC’s commercial arm, would be eligible for the cuts, the Chancellor indicated.
But BBC shows produced in-house for public-service channels could not be claimed for, because the BBC is non-profit making and therefore does not pay corporation tax.
The BBC then created a commercial subsidiary for drama – Grafton House Productions – and a subsidiary for comedy – BBC Comedy Productions.
It is through Grafton House that £520,133 has been reclaimed as nominal corporation tax for two dramas: The Interceptor and One Child.
The BBC could receive more, as there is a total budget of £205million for tax relief to drama, and a further £60million for animations.
Well played that man, well played.