Motion Picture Partners is a new limited liability partnership fund offering investors tax incentives, courtesy of the government.

Investors into the fund will receive 100 per cent income tax relief which could be carried back over three years so that income tax paid during the periodcould be reclaimed and invested in film productions. Players in the new fund were media and entertainment industry figures, assisted by an advisory panel including the actor Dougray Scott.

Rajeev Saxena, founding director of Motion Picture Partners, said qualifying films must have a budget of (GBP) 15m or less, an EU producer and more than 70 per cent of expenditure spent in the UK. Mr Saxena added the partnership had alreadysourced more than (GBP) 144m of potentially suitable productions.

The fund intends to maximise capital and tax relief by borrowing against secured collateral. It required pre-sales or production collateral equivalent to60 per cent of the production budget.

Motion Picture Partners said full recourse borrowing against production collateral should enable the fund to increase its maximum available capital fromGBP30m to (GBP) 369m. That in turn would allow investment in more films and increase the amount of tax relief on initial contributions from 40 per cent to 93.5 per cent.

Colin Jackson, director of IFA Baronworth, said the fund was at the high risk end of the investment spectrum and tax breaks were only beneficial if the fund performed. He said: "We dont get many Full Monty-type successes and were talkingabout quite low budget films here. Anyone thinking about investing in this type of fund should seek very careful and considered advice."