Requiti keeps up to date on not only federal, but provincial tax credits as well. There are programs here for businesses in Ontario and British Columbia but don’t hesitate to contact us about these or programs in other provinces.

Interactive digital media tax credit (IDMTC)

Program Review

Registered corporations that develop interactive digital media products in B.C., like video games, simulators, and educational products, may be eligible for the interactive digital media tax credit (IDMTC). 

An interactive digital media product (IDM product) is designed to be used interactively by an individual and:

  • Consists of a combination of application files and data files, in a digital format, that are integrated and are intended to be operated together,
  • Is designed primarily to educate, inform or entertain the user,
  • Is capable of presenting information in at least two of the following forms:
    • Text
    • Sound
    • Images
  • Is intended to be used interactively by individuals, and
  • Is developed in British Columbia.

but does not include a prescribed product.

Some examples of IDM products are:

  • Video games
  • Educational software
  • Edutainment products
  • Simulators

For the purpose of the IDMTC, products that are not intended to be used interactively are not IDM products. This includes:

  • Blogs
  • Online magazines or newspapers
  • Slide shows
  • Videos or PowerPoint presentations
  • Video streaming applications
  • Social media products

Funding up to

The credit is calculated as 17.5% of eligible salary and wages incurred in the tax year.

Eligibility

  • Incurred on or after September 1, 2010 and before September 1, 2023
  • Directly attributable to eligible activities, and
  • Paid to individuals who were resident in B.C. on December 31 of the year preceding the end of the corporation’s tax year

Ontario Interactive Digital Media Tax Credit (OIDMTC)

The Ontario Interactive Digital Media Tax Credit (OIDMTC) is a refundable tax credit available to qualifying corporations for expenditures related to the creation, marketing and distribution of eligible interactive digital media products. The credit is calculated as 40% of eligible labor and marketing and distribution expenditures for qualifying corporations that develop and market their own products (known as “non-specified products”), and 35% of eligible labor expenditures for qualifying corporations that develop products under a fee-for-service arrangement (known as “specified products”). A 35% refundable tax credit is also available to qualifying digital game corporations and specialized digital game corporations.

 

Product Tax Credit Rate Wages & Remuneration Marketing & Distribution
Non-specified products 50% Maximum $100,000/product
Specified products     35% N/A

 

Eligibility

  1. Interactive Digital Media Products

To be eligible for the OIDMTC, the primary purpose of your interactive digital media product must be to entertain the user, or educate users under the age of 12.

  1. Qualifying Corporations

A qualifying corporation is an Ontario-based Canadian or foreign-controlled corporation that develops an eligible product at a permanent establishment in Ontario. The qualifying corporation must operate the business and file Ontario tax returns.

  1. OIDMTC Expenditures

You can claim Ontario labor expenditures for both specified and non-specified products. You can also claim marketing and distribution expenditures for non-specified products.

The OIDMTC is an after-the-fact tax credit. You can apply to Ontario Creates for a Certificate of Eligibility:

  • After your product is completed (for non-specified and specified products).
  • After you have incurred and paid the costs to develop your product.
  • At the end of the tax year in which you completed your product.

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Our team is ready to show how we can help your business get the tax credits it deserves.