Incentive I provides aid based on Article 54 of Regulation (EU) 651/2014, with an annual limit of €25,000,000. Applications must be submitted by the Applicant, who can receive a maximum of 35% of eligible expenditures in Cyprus. Minimum expenditures are set at €200,000 for feature films, €100,000 for TV dramas, €50,000 for documentaries, and €30,000 for other TV programs, all not exceeding 50% of the total production budget. Aid is payable upon completion of shooting, following an accounting check of eligible expenditures, with payment occurring within 90 business days after the Final Approval Certificate is issued.

This measure provides a corporate tax reduction for the Applicant, in accordance with Article 54 of Regulation (EU) 651/2014. Aid is capped at 35% of eligible expenditures in Cyprus, with minimums of €200,000 for feature films, €100,000 for TV dramas, €50,000 for documentaries, and €30,000 for other TV programs, not exceeding 50% of the total production budget. The tax deduction is limited to 50% of taxable income for the year, with unused credits valid for five years. The tax credit is non-transferable and void upon liquidation.

Applicants investing in film production infrastructure and technology can deduct their investments from taxable income. Aid is capped at 20% for small enterprises and 10% for medium-sized, with equipment needing to remain in Cyprus for five years. Eligible expenditures include tangible and intangible assets tied to production. Investments must involve establishing or expanding a business or acquiring assets from closed establishments under specific conditions. Intangible assets must be depreciable, exclusively used in the business, and held for three years. New job vacancies created within three years must show an increase in employees and be maintained for three years. Deductions for SMEs will come from gross income, with unused amounts available for carry forward over five years. Total aid must not exceed 50% of the production budget or 60% for co-productions, with producers required to disclose any additional aid.

The Applicant is eligible for VAT returns on expenditures in accordance with European Directive 9/2008, while those from third countries generally are not, except for individuals from Israel, Norway, and Switzerland due to existing agreements. VAT returns can be filed within six months of the VAT declaration deadline or the application date.