The Tax Shelter

The Tax Shelter is a fiscal incentive that allows profitable companies to invest in audiovisual works, performing arts and video games in exchange for a reduction in corporation tax. This helps finance audiovisual and stage productions. 

The principle of the Tax Shelter

The Tax Shelter offers companies an opportunity to support cultural creation while benefiting from tax advantages. This stimulates investment in the cultural sector and encourages the development of new works and productions.

Through the Tax Shelter, organisations can invest in eligible projects, including films, TV series, live performances and video games. The amounts invested are deductible from the company's tax base, resulting in a significant reduction in its tax liability.

The tax shelter has existed for audiovisual works since 2003, for the performing arts since 2016 and for video games since 2022.

This Tax Shelter should not be confused with the Tax Shelter for small and medium-sized enterprises (SMEs).

In practice

The Tax Shelter is intended solely for cultural organisations (legal entities: companies, non-profit organisations, cooperatives)  subject to corporation tax. It is not available to individuals.

Eligible projects must meet certain criteria set by the tax authorities, notably in terms of cultural content and eligible expenditure. Companies wishing to benefit from the Tax Shelter must enter into an agreement with the producer of the cultural project and comply with the specific conditions set out by the tax legislation.

Key parties

Producer

Any Belgian company or Belgian branch of a foreign company whose main purpose is the production and development of audiovisual works, new stage productions or computer games. "Companies" refers to all legal entities (including non-profit organisations) as long as they are subject to corporation tax and recognised as production companies by the Minister of Finance.

How much can the producer receive?

The producer can secure investments of up to 50% of the total budget. The final Tax Shelter certificate will be issued no later than 4 years after the signing of the framework agreement and covers 70% of direct and indirect production costs within the European Economic Area (EEA). For the Tax Shelter certificate, 90% of expenses must be incurred in Belgium, with 70% of Belgian expenses being direct costs. This requires careful budgeting in advance. The 2018 Tax Shelter Performing Arts Annual Report (Culture, Youth and Media Department) notes that, on average, between 22% and 27% of the total budget is raised through the Tax Shelter.

How much compensation must be paid for the investment?

In addition, the producer may grant the investor an additional return on investment equal to the Euribor interest rate + 4.5% for a maximum period of 18 months. This period is limited to the time between the day the investment is paid and the date of the Tax Shelter certificate.

Investor

Any Belgian company or Belgian branch of a foreign company subject to corporation tax can invest via a Tax Shelter. Non-profit organisations can also invest provided they are subject to corporation tax.

Intermediary

An intermediary is an individual or legal entity that participates in the negotiation and conclusion of a framework agreement for a Tax Shelter certificate in exchange for compensation or a benefit, provided that they are recognised as an intermediary by the Minister of Finance.

Eligible production companies and investors cannot act as intermediaries.

Examples of intermediary companies: UMedia, Bel Arts

Why use an intermediary?

For Tax Shelter financing of a certain amount (over 50,000 euros) and a non-standard structure (due to the use of co-productions or separate production entities), it is advisable to use an intermediary who uses their reputation and expertise and can manage various tasks for a fee.

Intermediaries can therefore play an important role in finding investors if the producer's own network does not offer enough suitable partners.

According to the 2018 Tax Shelter Performing Arts Annual Report (Culture, Youth and Media Department), the cost of an intermediary is on average around 13% of the amount raised.

Eligible productions

Audiovisual works

European audiovisual works recognised by the Flemish Community or the Brussels Region as European works within the meaning of the "Audiovisual Media Services Directive" of 10/03/2010 (2010/13/EU).

• A fiction film, documentary or animated film intended for cinema screenings
• A short film excluding commercial films
• A television fiction film, whether divided into several episodes or not
• A fiction or animated series
• Children's and youth series, specifically fiction series with educational, cultural and informative content aimed at a target group aged 0-16
• A television documentary

👉 More information on the procedure in the Wallonia-Brussels Federation

👉 More information on the procedure in Flanders

Stage productions

These must be new stage productions recognised as European stage works by the Flemish Community (application via KIOSK) or the Brussels Region (FPS Scientific Policy - Belspo). "Stage productions" are defined as live performances of theatre, circus, street theatre, opera, classical music, dance or musical theatre, including musicals and ballet. Straight recordings are not eligible. Each of these stage productions is characterised by a detailed script.

Combinations of performing arts are also eligible under the "total show" category. This includes choreography, acting, special effects, pyrotechnics and innovative technologies in sound, image and scenography.

To be considered a new stage production, the script, staging or set design must be new or a reinterpretation of an existing work. The reproduction of an existing staging, script or choreography is excluded.

👉 More information on the procedure in the Wallonia-Brussels Federation

👉 More information on the procedure in Flanders

Video games

All Belgian companies or Belgian branches of non-Belgian companies whose main purpose is the production of video games are eligible. The development and production of video games must be the company's core business, with revenues from the production and operation of video games representing at least 50% of total income.

A wide variety of video games are eligible for Tax Shelter funding, including artistic, serious, educational and entertainment games.

Video games must pass the cultural test, allowing them to be considered as European cultural products. This test is included in the application procedure.

The video game must be produced by an eligible production company, recognised by the FPS Finance.

👉 More information on the procedure in the Wallonia-Brussels Federation

👉 More information on the procedure in Flanders