A 54% rebate is the headline. But producers who come back are won over by something harder to put in a spreadsheet: a single archipelago that can stand in for a dozen worlds, four flying hours from London or Berlin.
For years, the conversation about where to shoot in Europe revolved around a familiar handful of names. That conversation has changed. The Canary Islands — eight volcanic islands off the northwest coast of Africa, but politically and legally part of Spain and the European Union — have quietly assembled one of the most competitive production offers on the continent. The numbers are the obvious draw, so let's start there.
The incentive, in plain terms
The Canary Islands operate under the Canarian Economic and Fiscal Regime (REF), which allows the islands to offer film and audiovisual rebates roughly twenty percentage points above mainland Spain. In practice, that means a rebate of 54% on the first €1 million of qualifying spend and 45% on the remainder, up to a maximum deduction of €36 million per feature.
54% / 45%
To qualify, an international production generally needs to engage a Canary-based production services company and meet a minimum local spend — which is exactly the kind of structure we handle for the productions we line-produce. The rebate applies to expenditure incurred on the islands: crew, talent, services, equipment, accommodation and more.
The layers most people miss
The rebate is only the first layer. A production company established in the Special Canary Zone (ZEC) can access a reduced corporate tax rate of 4%, against the standard Spanish rate. On top of that, production services are generally exempt from IGIC — the local equivalent of VAT — meaning 0% on those services rather than mainland Spain's 21%. Stacked together, these mechanisms make the islands not just a cheaper place to shoot, but a genuinely efficient place to base a production.
Twenty points above the mainland, before you've pointed a single camera at the landscape.
And then there's what's in front of the lens
Incentives bring producers to the table. Geography keeps them there. Within a single island you can move from black volcanic desert to laurisilva — ancient subtropical cloud forest — to Atlantic coastline in well under an hour. Mount Teide, Spain's highest peak, gives you an otherworldly backdrop that has stood in for everything from alien planets to prehistoric Earth.
The practical advantages
- 365 days of natural light. A stable, mild climate means fewer weather days lost and longer usable shooting windows year-round.
- Four-hour flights from major European capitals, with direct connections to dozens of cities.
- A maturing crew base — experienced local heads of department, plus more than a dozen VFX and post-production studios now operating on the islands.
- EU framework. You are filming inside the European Union, with the legal certainty, co-production treaties and infrastructure that brings.
The honest caveat
Incentive structures, caps and minimum-spend thresholds are reviewed and updated by the authorities, and the right structure depends on the size and nature of your production. Figures here reflect the framework as we work with it; we always confirm the current terms for each project before committing them to a budget. That's part of what a local production partner is for.
If you're weighing the Canary Islands for a 2025 or 2026 shoot, the best next step is a conversation about your specific project — budget, schedule, and the look you're chasing. We can tell you quickly whether the islands are the right fit, and what the rebate would realistically mean for your bottom line.