John Graydon

Source: Saffery

John Graydon

In an upbeat keynote address to open the  Film London Production Finance Market (PFM) today (October 8), John Graydon, senior partner at leading film and TV accountancy firm Saffery, predicted the new Independent Film Tax Credit (IFTC) will make the UK a hub for coproduction.

The IFTC is an enhanced expenditure credit of 53% that equates to approximately 40% in tax relief on eligible spend. 

“You can already see the shift. That 40% is very attractive [to international partners]. My own perception is [coproductions] are going to come back in favour very quickly. In fact, I think they already are,” Graydon stated, citing the increasing number of projects already coming to him.

“It is the biggest news in the independent film community in my career and the time I have been working in the sector, which is nearly 30 years,” Graydon stated. “It is going to make a really big difference.”

Interviewed on stage by Judith Chan, executive director in media banking for Coutts & Co, Graydon also forecast the UK could now become a major magnet for US and international horror pictures from companies like Blumhouse and Black Bear.

“I do think we might become the home of horror,” Graydon said. “The model of having a decent star and a relatively modest below-the-line spend keeps you well below the £15m [threshold] and getting 40% is quite compelling. I don’t feel that we will necessarily see more studio work but I think we will see more US indies come across [to make films in the UK].”

Graydon has also called for EIS [Enterprise Investment Financing] to be looked at again by the government. After a series of well-chronicled controversies, EIS can no longer be used for single film projects – but Graydon believes there’s a case to revise the criteria.

“EIS is a government-produced piece of legislation that is meant to encourage investment in risky businesses,” Graydon noted. “It was very popular in the 2010s. Then it was subject to a clampdown from government because they didn’t like the lack of risk.

“I like EIS in the sense that if you want to get investors to invest in film, there has to be something to encourage them to do that. It’s not the tax credit. That won’t encourage them to do that because that will form part of the finance plan. It has got to be something else.”

Graydon called for “some debate with government” about how EIS could potentially be retooled so that single pictures could again become eligible for support.

Despite widespread industry dismay at the recent British Screen Forum report on dismal recent trends in UK film financing, both Graydon and Chan claimed there is still investor appetite for UK indie films. 

“My perception is that there are a lot of people who want to invest in film…[but] there needs to be a funnel, a place where you can go,” Graydon said.

“How do I see the future for independent film? I think it is going to get better. I think it’s going to remain hard… [but] I think it is going to improve. There has been a lot of talk about this new credit but it’s not really in yet and we haven’t felt the benefits of it. As more interest comes into the UK, and there’s more work available for our producers, both their own projects and other people’s, that starts to create a more sustainable business model,” he concluded.

Following Graydon’s address, there was a case study of Grand Theft Hamlet. Previously a PFM New Talent Strand selected project, Grand Theft Hamlet premiered at SXSW this year and won the grand jury award for best documentary feature.

A total of 117 producers/filmmakers and 68 financiers are attending the two-day PFM event (October 8-9), held at the Thistle Hotel in Marble Arch in association with the BFI London Film Festival which opens on October 9.

Over the last decade, PFM said it has introduced 647 projects to financiers, studios and sales agents, with the total value of deals reaching over £254m. Now in its 18th year, the PFM is showcasing projects from the UK, Canada, Australia, the US, Germany, Austria, South Africa, The Netherlands, France, Brazil and Italy.