Explainer 05
A production is a company with a fixed amount of money, a fixed date to spend it by, and no revenue until long after everybody has gone home.
Almost every strange behaviour you will meet on a set — a good idea refused, a fight over half a day, an invoice that takes eleven weeks — is explained by the budget rather than by anybody’s character. Understanding the money is the fastest way to stop taking this industry personally.
Four things here: how a budget is built, where the money comes from, how the UK credits work, and why your payment arrives so much later than you expect.
Before your first day
Three things to settle in writing.
01
The rate and the standard day
What the rate covers, how many hours are in the standard day, and how overtime is calculated. An email is enough. Nothing is not.
02
How you are engaged
On the production’s payroll and taxed at source, or self-employed and invoicing. It has real consequences and many people do not know which they are.
03
Kit, turnaround and holiday pay
Equipment you own is a separate rental you invoice for. Ask how holiday pay is treated and what happens if turnaround is broken.
The budgetAbove the line, below the line, and the lines underneath both
| Section | What sits in it | Rough share of a mid-budget drama |
|---|---|---|
| Above the line | Story and script rights, the writer, the producer, the director and the principal cast. Individually negotiated, often with deferrals attached. | 15–30 per cent |
| Below the line: production | Everything it takes to shoot. Crew, equipment, sets, locations, costume, transport, catering, insurance. | 40–55 per cent |
| Below the line: post | Edit, sound, music, visual effects, colour, and the whole delivery list. | 10–25 per cent, far more with heavy VFX |
| Other and indirect | Legal, financing costs and interest, audit, publicity, and the completion bond. | 5–10 per cent |
| Contingency | Held back for the things that will go wrong. Financiers dislike seeing it spent early. | Around 10 per cent |
A film budget is forty to eighty pages summarised on a one-page top sheet. Its oldest distinction is between the few people whose deals are negotiated individually and everybody else, whose costs are calculated.
The stackWhere the money comes from, and why it is late
An independent British film is almost never funded by one party. It is a stack: public funding, a broadcaster or streamer, a tax credit, pre-sales to foreign territories, private equity, and a loan bridging the gap between what has been promised and what has landed.
The completion bond
On most financed features a bond company guarantees the film will be finished and delivered. It costs a small share of the budget, and in return the bond company can take over the production if it goes badly wrong. That is why schedules and contingencies are defended so fiercely.
Recoupment order
When money comes back it is paid out in a fixed order: fees and expenses, then debt, then the gap lender, then equity, and only then any profit share. Anybody on a percentage of net profit is at the end of a long queue.
Cashflow is not budget
A production can be fully financed and still short of cash this Tuesday, because a contracted instalment arrives next month. Nearly all late payment here is a cashflow problem rather than a solvency one, which is no comfort if it is your invoice.
The creditsThe UK expenditure credits, which are constantly confused with each other
| Relief | Headline rate | What it applies to |
|---|---|---|
| Audio-Visual Expenditure Credit — standard rate | 34 per cent gross, worth about 25.5 per cent net of corporation tax | Qualifying UK expenditure on a certified film or high-end television programme, on up to 80 per cent of core expenditure. |
| Independent Film Tax Credit | 53 per cent gross | Films with core expenditure at or under £23.5m, with the relief payable on the first £15m of qualifying expenditure. This is the 53 per cent figure people quote, and it belongs to independent film and to nothing else. |
| Visual effects uplift | 39 per cent gross, worth about 29.25 per cent net | UK visual effects costs. Its most valuable feature is not the higher rate but the exemption from the 80 per cent cap, so qualifying UK VFX spend counts in full. |
The UK supports film and high-end television through the Audio-Visual Expenditure Credit, claimed against qualifying UK expenditure once a production is certified as culturally British. It is misquoted more often than any other figure in the industry.
Your payHow a freelancer gets paid
| Element | How it works |
|---|---|
| Day rate and weekly rate | A day rate covers a standard working day, usually ten or eleven hours plus a break. A weekly rate on a longer engagement is typically worth less per day: you trade the premium for continuity of work. |
| Overtime | Beyond the standard day, usually at a premium, recorded on a timesheet signed by your head of department. Sixth and seventh days are paid at a higher rate again. Keep your own record as well as theirs. |
| Turnaround | The minimum rest period between wrap and the next call. Breaking it triggers a payment, which is why a production will move a call time rather than pay it. |
| Kit and box rental | If the production uses equipment you own — a sound kit, a trolley, tools, a laptop — you invoice a separate rental. It is not employment income and it is negotiated separately. |
| Holiday pay | Accrued on payroll engagements and either paid as it accrues or held and paid on request. Check which, in writing, at the start. |
| Everything you now buy yourself | Sick pay, pension, insurance, training, tax set aside, and the weeks between jobs. Budget on working substantially fewer than fifty-two weeks a year, because almost nobody does. |
Most people on a British production are freelance, hired for that production only. Being freelance does not mean being paid gross: a large share of below-the-line crew are engaged through the production’s payroll and taxed at source.
Camera car moving down a street, runner alongside
The wait
Five steps between your work and your bank account.
A production is not being casual with your invoice. It is running an approval chain designed to stop money leaving without authorisation, and that chain is slow by construction.
- Your timesheet or invoice is approved by your head of department, who is on the floor for eleven hours and reads paperwork afterwards.
- It is matched to a purchase order somebody in the production office raised, or rejected and returned if it does not match.
- Payment terms from a correctly submitted invoice are normal, and the clock starts at correct submission rather than on the day you worked.
- The production’s own cash arrives in contracted instalments and the credit lands after an accounting period ends, so a fully financed film can still be waiting.
- And the company dissolves. Chasing a payment from a production that wrapped nine months ago means finding a producer, not an accounts department, which is why you chase early, politely and in writing.
What to do about it
Four habits that separate people who survive freelancing from people who leave it.
Get the deal in writing before the first day
Rate, hours in the standard day, overtime basis, turnaround, kit rental, holiday pay, and whether you are on payroll or self-employed on this job.
Before you start
Invoice the day the week ends
Correctly, with the purchase order number, to the right address, in their format, and set your tax aside the day you are paid. Most late payment starts as a wrongly formatted invoice sitting in an inbox.
Weekly
Keep a float
A realistic target is three months of living costs before you rely on freelance income. It is the largest reason people from wealthier families last longer in this industry, and naming it is more useful than pretending otherwise.
Structural
Join something that will fight for you
A union or professional body gives you rate guidance, contract review and somebody to call when a production stops answering.
Early
If money is the reason you are hesitating about training at all, raise it first rather than last. It is the most common reason people stop and the one most often solvable.
Next
Rates come from the guilds and the unions, not from us.
What each grade is paid is published by the bodies that negotiate it, and the freelancing guide points at every one of them. What we give you is the language, the grades and the behaviours that get you into the position of being paid at all.
