Working as a freelancer in the UK film and television industry can be incredibly rewarding but navigating the complex web of HMRC tax rules is essential for staying compliant and maximising your take-home pay. This comprehensive guide explains everything you need to know about self-employment taxation for behind-camera crew in the UK film, TV and radio industries.
The most crucial aspect of your tax situation is your employment status classification. HMRC has specific guidance for the entertainment industry that determines whether you're considered self-employed or an employee for tax purposes.
HMRC maintains a comprehensive list of behind-camera roles that are normally treated as self-employed when certain conditions are met. The list covers various production departments including:
To qualify for self-employed status, you must meet criteria in either Column A (role-specific conditions) or Column B (production-specific conditions) of HMRC's detailed guidance. Click here to download the full list.
A significant improvement for freelancers came in 2020 when HMRC scrapped the controversial nine-month rule. Previously, any engagement lasting longer than nine months would automatically trigger employee status. This often forced artificial breaks in employment for continuing drama productions. The new rules focus on whether each engagement is genuinely separate and discrete.
As a self-employed freelancer, you pay income tax on your profits (not total income) after deducting allowable business expenses. The current income tax bands for 2025/26 are:
|
Income Band |
Rate |
Annual Threshold |
|
Personal Allowance |
0% |
Up to £12,570 |
|
Basic Rate |
20% |
£12,571 to £50,270 |
|
Higher Rate |
40% |
£50,271 to £125,140 |
|
Additional Rate |
45% |
Over £125,140 |
Significant changes to National Insurance came into effect in April 2024:
Class 2 National Insurance: If your profits are £6,725 or more annually, Class 2 contributions are treated as having been paid automatically to protect your National Insurance record. You no longer need to actually pay these contributions.
Class 4 National Insurance:
For very small amounts of self-employment income, you can benefit from the £1,000 trading allowance. If your total self-employment income is £1,000 or less annually, this is completely tax-free and you don't need to register for Self Assessment or file a tax return. This is particularly useful for occasional work or when starting out in the industry.
The VAT registration threshold increased to £90,000 in April 2024. You must register for VAT if your taxable turnover exceeds this amount in any 12-month period. Once registered, you'll charge 20% VAT on your services and can reclaim VAT on business purchases.
Maximising your allowable expense claims is crucial for reducing your tax bill. Common deductible expenses for film and TV freelancers include:
Many freelancers operate through Personal Service Companies (PSCs) - limited companies set up to provide their services. While this can offer tax efficiency benefits, you must consider IR35 (off-payroll working) rules.
Limited companies pay Corporation Tax on profits:
If you extract profits as dividends, you'll pay dividend tax:
IR35 rules determine whether your contract would be considered employment if you were providing services directly. Key factors include:
For freelancers working short-term contracts who might otherwise be paid through PAYE, Lorimer letters (also called LP10 letters) provide HMRC confirmation of self-employed status. These letters:
To obtain a Lorimer letter, you must demonstrate genuine self-employment through multiple short-term contracts across different productions.
If your tax bill exceeds £1,000, you'll need to make payments on account:
Maintain detailed records of:
Records must be kept for at least 5 years after the Self Assessment deadline.
Start Early: Don't leave tax planning until year-end. Regular reviews help optimise your position and avoid unexpected bills.
Professional Advice: Given the complexity of entertainment industry taxation, professional accountancy advice often pays for itself through legitimate tax savings and peace of mind.
Stay Informed: Tax rules change regularly. The IR35 reforms in 2021 and recent National Insurance changes demonstrate the importance of staying current with legislation.
Budget for Tax: Set aside 25-30% of your income for tax obligations. This ensures you're not caught short when payment deadlines arrive.
Understanding and complying with HMRC's self-employment rules is essential for a successful freelance career in the UK film and TV industry. While the rules can seem complex, proper planning and professional support will help you navigate them effectively while maximising your financial position. Remember that investment in proper tax advice and compliance is an investment in your career's long-term sustainability.
Why not book a meeting with us to discuss your circumstances and see how we can help.