Standard Industrial Classification (SIC)
Contents
What are Standard Industrial Classification codes?
Standard Industrial Classification codes (or SIC codes) are an essential part of Government statistics.
They are used to categorise businesses together into different kind of related activities (whether games development or estate agents etc.). Every industrial sector is assigned a number of SIC codes relating to the activities of businesses within that sector and therefore these form the basis of the "official" measurements of that sector, such as for employment or contribution to UK GDP.
Why is it important for get your SIC code right?
The UK games industry is a relatively new industrial sector and so the process and language of SICs is not yet ideally mapped to our sector.
SIC codes are attributed to businesses in a number of ways, often by matching key words from company descriptions. This is sometimes inaccurate and results in games business being allocated the wrong the code or simply not being allocated an SIC code at all. Similarly, the language for the developer classification refers to "ready-made interactive leisure and entertainment software" rather than simply "games", which also causes misclassifications, with many developers instead choosing more generic "IT services" or similar descriptions.
As a result, many games business are not counted as such in government statistics and therefore the importance of our sector is at risk of being significantly undervalued in official reporting. In fact, the economic value of misclassified games businesses may be incorrectly attributed to another sector.
Official statistics are important as they are often used to decide which sector might need public support, where that support can be best applied and how existing measures (such as tax relief) are achieving their aims.
Therefore it is essential that every games businesses uses the right SIC code, ensuring Government statistics show the true value of the UK games sector.
Checking your SIC Code
You can see the SIC code assigned to your business with a simple check on Companies House, where it will be listed under 'Nature of Business (SIC)'.
SIC Codes for the Games Industry
There are two primary SIC codes assigned to the UK games industry, these are:
- For publishers: 58.21/0 Publishing of computer games
- For developers: 62.01/1 Ready-made interactive leisure and entertainment software development
Updating your SIC
SIC codes are taken from 4 different sources in the following order of importance and, if possible, we recommend making sure that your business has the right code in all four sources:
1. The Business Registers and Employment Survey (BRES)
An annual survey sent out to a sample of 80,000 businesses. All large businesses with 2.2m UK VAT and/or PAYE based enterprises in Britain are sampled each year. Many smaller businesses won’t receive a questionnaire annually, so for those not included in the survey, updating the HMRC and Companies House data below is important. You will be asked to write in a description, which will then be automatically coded. You should use similar descriptions to those used by the ONS in the list below to match descriptions against.
2. HMRC VAT Registration
If you’re registering for VAT online, you can just select one of the two games SIC codes above from a drop-down box of codes.
If you’re using postal VAT registration: you will be asked to describe your ‘business activities’ on the registration in question 20 (page 9) of the Application for VAT Registration form. Here you should use descriptions similar to those in the list below.
3. Annual HMRC PAYE Return
Use the ‘nature of business’ section to describe your business using the list of descriptions below.
4. Companies House and Annual Return
Changes to your company can be submitted directly to Companies House.
Alternatively, every company must deliver an annual return to Companies House at least once every 12 months. Simply add one or both of the appropriate games related SIC codes above in section A3 as classification codes. You may also include a principal activity description with the keywords mentioned below.
HMRC PAYE Returns Business Descriptions
HMRC's PAYE returns will ask you to provide a description of your business in the ‘nature of business’ section, which will be used to assign an SIC. To ensure your business is included as part of the games industry, describe your business using the list of descriptions below.
Publishers - If your company's main activity is publishing games then use these descriptions (for SIC code 58.21/0 “Publishing of computer games”)
- COMPUTER GAMES PUBLISHING
- ON-LINE COMPUTER GAMES PUBLISHING
Developers - If your company's main activity is developing games then use these descriptions (for SIC code 62.01/1 “Ready-made interactive leisure and entertainment software development”)
- COMPUTER GAMES DESIGN
- COMPUTER GRAPHICS
- DESIGN AND DEVELOPMENT OF GAME SOFTWARE
- DESIGN AND DEVELOPMENT OF INTERACTIVE MEDIA
- DEVELOPMENT MOBILE PHONE GAMES NON CUSTOMISED
- VIDEO GAMES DEVELOPMENT
