Firstly, do you need to set up your own production company?
If you’re a group of friends working together voluntarily with no budget, using your own home and camera to shoot a film, chances are you don’t need one.
If however, you’re employing people (i.e. paying them), renting equipment and hiring professional actors then it is a worthwhile facility to consider using. But, it is a lot of work, with plenty of penalties if you don’t keep up with the paperwork. It’s really only something to consider for people who see a long term financially viable future for themselves in the film industry.
Before you jump…
Before you set up a production company (the mechanics of which are discussed below), the first thing you should do is spend at least a few days in another production company, learning how everything works day-to-day. Every successful production company uses the same ingredients as other successful businesses, which are a solid business plan, good market research and organized, talented people.
Realise that film is a business and a production company is a business like any other. If you or your partner do not have any business acumen and don’t find the prospect of being a business manager appealing then don’t set up a production company. It will eat up your valuable directing, writing, camera operating time. Instead, work as a freelancer/self-employed person. Although you’ll still have to manage your own books, there’ll be less frustrating business work to eat up your time.
Ideally at least one of the company directors (you’ll need two for a limited company) will have significant production experience with another company, particularly experience of dealing with funders or investors.
Where is your income going to come from?
It’s not enough to say, I’ll apply to the Film Board for money. They give their annual allowance to a small proportion of the companies that apply each year. Those with that year’s strongest projects and with the most experienced teams are the ones that get the cash. You should still apply but start off with the smallest budget scheme they have. Don’t apply for a €100,000 feature when you’ve never made a successful short, you won’t get it.
Investigate all sources of potential revenue and find out which you are particularly eligible for e.g. regional funds, minority bursaries etc. Don’t rely on any one source of funding. Try to develop relationships with broadcasters. Look beyond Ireland, loads of U.S. filmmaking bursaries and competitions are open to Irish nationals.
It’s important to the realistic. If you’re just out of college and have no professional contacts or experience it’s unlikely that setting up a production company is a good idea. It would probably be a better use of time to get an intern position at a busy production company and learn how things work in the industry first.
Difficulties involved in running a production company
Penalties for late/incomplete tax returns.
Less time for making films.
Setting up the Company
After all the negatives, if you’re still happy to set up your own company, here’s how:
1. Register with Revenue as a Limited Company (This means limited liability, as opposed to being a Sole Trader where your personal assets can be used in extreme circumstances to pay company debts. We’d like to avoid that.)
2. Register your business name with the Companies Registration Office. http://www.cro.ie
3. Keep accurate accounts (update weekly) and remember that you will have to file tax returns to the Revenue every October.
4. You’ll need a Health & Safety Statement (This is very straightforward, I’ll be adding a sample to the blog very soon.)
5. It is highly recommended that you prepare a business plan, cash flow projection and do some market research before you commit financially to setting up a company.
Articles to come on Reducing your Insurance costs, Approaching Producers with Scripts, Tax for Freelancers, Music Clearances, Using Archive Material