The government of Canada provides tax credits for digital media projects such as game development, educational software, animated simulators and more. Digital media tax credits are offered for qualifying companies permanently located in the provinces of British Columbia, Manitoba, Ontario, Quebec, Nova Scotia, and Prince Edward Island.
At Boast Capital, we focus on helping companies claim the British Columbia Interactive Digital Media Tax Credit (IDMTC).
British Columbia’s Interactive Digital Media Tax Credits
IDMTC came into effect September 1, 2010 to stimulate revenue and job creation within the digital media industry in British Columbia.
What Can You Claim?
IDMTC provides a refundable 17.5% tax credit on eligible salary and wages involved in creating interactive digital media (IDM) products. The credit is fully refundable but is first applied to income tax payable.
A qualifying IDM product should designed to be used interactively by an individual and consist of a combination of files that are digitally integrated and are intended to be operated together. Qualifying products must also either educate, entertain, or inform using at least two of the following: text, sound, and/or images. Examples of eligible IDM products includes:
Entertainment (or edutainment) software
Simulators, such as driving a car
Blogs, online magazines and newspapers, slideshows, videos or presentations that are not made to be used interactively do not qualify.
Who Can Claim It?
Companies permanently located in British Columbia can claim the tax credit.
When Should You Submit a Claim?
Similar to the SR&ED tax credit, your deadline to file IDMTC is 18 months past fiscal year end.
BC’s IDMTC Expires on September 1, 2018.