FFA to produce tax-efficient movies

A 50/50 joint venture between Australia’s Goldstream Capital and Future Film Group United Kingdom is looking to lure investors to the silver screen.

The venture, called Future Films Australia, is looking to raise $250 million to fund 12 Australian-based movie projects. The offer is now open and closes on June 30. Sam Gullotta, Australian-based director of FFA said the venture aimed to change investors’ perceptions that film was risky, and get them to think of it as another alternative asset class. A minimum investment of $250,000 is required, to be followed by an additional contribution equaling 2.57 times the initial subscription. Tim Levy, chief executive of Future Film Group UK said the venture was targeting sophisticated investors who were looking for a tax efficient investment. Only films which have secured distribution deals, and thereby a minimum income stream, will be eligible for investment. FFA is offering a first year tax deduction of 326 percent of investors’ initial capital contribution, as well as a 6 per cent share of gross receipts. FFA will invest in “Australian qualifying films” to meet the provision of division 10BA of the Income Tax Assessment Act, and therefore be eligible for tax breaks. Australian qualifying films will not necessarily be Australian stories, and can include co-productions with other countries. FFA will apply for product rulings from the Australian Tax Office for each film it wishes to invest in, to confirm its tax status. Two projects have already received product rulings and been admitted to the program The Future Film Group UK has provided funds for films such as Kill Bill 2, Bend It Like Beckham, Mrs Henderson Presents, The Village and Princess Diaries 2.