Why countries use one
Incentives are paid with public money, and most governments want that money to support local culture and local jobs. A cultural test turns that aim into a checklist. In the UK it is the gate to the Audio-Visual Expenditure Credit, which pays 34% for film. Films applying for the enhanced 53% rate for lower-budget productions also have to show they meet the budget condition and a creative connection requirement, according to the BFI.
Australia takes a different approach for its producer offset. Instead of a points table, Screen Australia applies a Significant Australian Content test that weighs the subject matter, where the project was made, and who made it.
Scoring a hypothetical film
The BFI's film test has four sections. Here is how a UK and US financed thriller, set in New York but shot at a UK studio with a mostly British cast and crew, might score. The section maximums are from the BFI. The scores are illustrative, and the BFI's guidance notes explain how each section breaks down.
| Section | Maximum | Example score | Why it scores |
|---|---|---|---|
| A: Cultural content | 18 | 6 | English language, a British lead character, US setting |
| B: Cultural contribution | 4 | 1 | Some claim to British creativity |
| C: Cultural hubs (where work is done) | 5 | 5 | Shooting, VFX, and post in the UK |
| D: Cultural practitioners (nationality of key people) | 8 | 7 | UK director, writer, most cast and crew, US composer |
| Total | 35 | 19 | Pass at 18 |
Nineteen points is a pass, but it is thin. Replacing the director with a non-qualifying one or moving post out of the UK could drop the film below 18, which is why producers lock the points before signing key deals.
Where applicants go wrong
The common error is treating the test as a formality and scoring it after hiring. By then the director, composer, and post house are contracted and the points are fixed. The second error is confusing passing the test with receiving money. Passing makes the film British for tax purposes. The credit itself still depends on qualified spend, which under AVEC is capped at the lower of 80% of core expenditure or the UK core expenditure incurred.
Related pages
If a film can't pass, an official co-production treaty may be the better route. The United Kingdom incentive page covers the credit rates, and the cultural test explained goes through other countries' tests. For how the credit fits in a capital stack, see film financing.