Manitoba — Interactive Digital Media Tax Credit
MN, Canada
Manitoba tax credit for digital media production
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|projectCostPercent
grant_single|deadlines
- grant_single|timelineUnspecified
grant_single|financingType
Tax Credits
grant_single|eligibleIndustries
- Information and cultural industries
grant_single|grantors
- Government of Manitoba
- Economic Development, Investment, Trade and Natural Resources
grant_single|status
grant_card_status|open
grant_single_labels|preview
Refundable corporate income tax credit of 40% of wages paid to Manitobans working on interactive digital media projects in Manitoba, up to a maximum of $500,000 per project.
grant_single_labels|projects
Yes, projects and activities related to developing eligible interactive digital media products primarily for commercial use or providing qualifying product add-ons are eligible for this grant.
- Development of eligible interactive digital media products
- Creation of product updates or enhancements (add-ons)
- Interactive content development and programming
- Creation of downloadable content
- LiveOps work
- Project-related IT and data analysis labour
- Marketing and distribution activities directly attributable to the product for companies that own the product's intellectual property
grant_single|admissibleProjectsExample
$192,000
Vancouver
Development of an e-commerce platform with AI-driven recommendations
$180,000
Toronto
Creation of a mobile game with in-app purchases and downloadable content
$160,000
Ottawa
Development of a fitness tracking app with interactive challenges
$160,000
Calgary
Enhancement of an existing weather forecasting app with new interactive features
$160,000
Montreal
Creation of an interactive virtual museum experience
grant_single_labels|admissibility
To be eligible for the Interactive Digital Media Tax Credit, both the corporation and the interactive digital media product being developed must meet specific criteria. Furthermore, projects must also adhere to defined guidelines to qualify for this tax credit.
- The corporation must be a taxable Canadian corporation either federally or provincially incorporated.
- The corporation must have a permanent establishment in Manitoba throughout the year or the part of the year in which eligible expenses are incurred.
- To qualify for a 40% tax credit on eligible expenditures, the corporation must pay at least 25% of its total corporate annual salaries and wages to employees who are Manitoba taxpaying residents during the year(s) in which eligible project expenses were incurred.
- Alternatively, to qualify for a 35% tax credit, the corporation must incur at least $1,000,000 in total eligible Manitoba labour expenses during the corporate year related to its eligible projects if it pays less than 25% of its salaries and wages to Manitoba residents.
- Eligible corporations can be controlled by Canadian or foreign owners and there are no restrictions on the corporation's size.
- No requirement for the corporation to own the rights to the intellectual property of the eligible product.
- Development labour expenses must be directly attributable to an eligible project and incurred after the application for a Certificate of Eligibility is submitted and received by the department.
- Marketing and distribution activities can only be claimed if the applicant owns and retains the intellectual property for the eligible product, and expenses do not exceed $100,000.
- Products must provide non-linear media interactions, allowing the user to become a participant rather than merely a reader or spectator.
- Products not intended to be used interactively, primarily promotional products, chiefly interpersonal communication products, hardware development projects, and products deemed contrary to public policy are not eligible.
grant_eligibility_criteria|who_can_apply
Yes, there are eligible types of companies for the Manitoba Interactive Digital Media Tax Credit. Eligible corporations must be taxable Canadian corporations, have a permanent establishment in Manitoba, and meet specific salary or labour expenditure criteria.
- Must be a taxable Canadian corporation incorporated in Canada (either federally or provincially).
- Must maintain a permanent establishment in Manitoba throughout the year or the part of the year in which eligible expenses are incurred.
- To qualify for a 40% tax credit, a corporation must pay at least 25% of its total corporate annual salaries and wages to employees who are Manitoba taxpaying residents during the eligible project year(s).
- To qualify for a 35% tax credit, a corporation must incur at least $1,000,000 in total cumulative eligible Manitoba labour expenses during the corporate year related to its eligible projects if it pays less than 25% of its salaries and wages to Manitoba residents.
- Eligible corporations can be controlled by Canadian or foreign owners and have no restrictions on size (market capitalization, number of employees, etc.).
- Fee-for-service work is allowed, and there is no requirement for the corporation to own the rights to the intellectual property of the eligible product.
- Corporations may work on multiple eligible projects at one time with no limit on the number of project applications in a given year.
grant_eligibility_criteria|who_cannot_apply
The grant context does not specifically list any types of companies that are ineligible for the Manitoba Interactive Digital Media Tax Credit. Eligibility is centered around the corporation's permanent establishment in Manitoba and the nature of the product and project.
grant_eligibility_criteria|eligible_expenses
Yes, there are eligible expenses for this grant. Eligible expenses are limited to development labour costs directly attributable to the project and certain marketing and distribution activities.
- 100% of qualifying salaries, wages, project related bonuses, and employee benefits paid to Manitoba employees
- 65% of eligible Manitoba labour component of fees paid to a qualifying third-party contractor
- Qualifying portion of salaries and wages paid to pre-approved Skills Transfer Allowance recipients
- Up to $100,000 in eligible marketing and distribution expenses for corporations that own and retain intellectual property rights
- 50% of expenditures for food, non-alcoholic beverages, and entertainment directly related to marketing and distribution of the eligible product
grant_eligibility_criteria|zone
To be eligible for the Manitoba Interactive Digital Media Tax Credit, a corporation must have a permanent establishment in Manitoba and comply with specified criteria.
- Manitoba
grant_single_labels|criteria
Yes, there are evaluation and selection criteria for the Manitoba Interactive Digital Media Tax Credit grant. Eligibility and assessment include a review of various aspects such as corporate qualifications, project specifics, and compliance with labor expenditure requirements.
- Company must be a taxable Canadian corporation with a permanent establishment in Manitoba.
- The corporation must pay at least 25% of its total corporate annual salaries and wages to Manitoba taxpaying residents during the qualifying period or incur at least $1,000,000 in total cumulative eligible Manitoba labor expenses.
- The project must be for developing or enhancing an eligible interactive digital media product, primarily for commercial use.
- Products must provide non-linear, interactive media experiences involving at least two forms of media: text, sound, or images.
- Eligible expenses include development labor costs, marketing and distribution costs incurred after applying for a Certificate of Eligibility (COE).
- Labor expenses cannot be claimed if already covered by other government assistance unless specific exceptions apply.
- Marketing and distribution expenses are capped at $100,000 per product and must be directly attributable to the promotion of the eligible product.
- Qualifying project activities need a Certificate of Eligibility before expenses can be claimed, which reflects preliminary project eligibility and estimated tax credit amounts.
- Project status, scope, and budget changes must be documented through an Amended Certificate of Eligibility if they occur during project progress.
grant_single_labels|register
- Step 1: Contact us and apply for a Certificate of Eligibility before starting work on your project
- Step 2: Undertake development work on your interactive digital media project
- Step 3: Submit eligible expenses to the province to receive a Tax Credit Certificate
- Step 4: File your Tax Credit Certificate with the Canada Revenue Agency
grant_single_labels|otherInfo
The Manitoba Interactive Digital Media Tax Credit (IDMTC) provides significant financial support to corporations developing interactive digital media products through refundable corporate tax credits.
- It offers up to 40% tax credit on qualified Manitoba labour expenditures.
- Marketing and distribution expenses directly incurred in the development of eligible products can also be claimed up to a maximum of $100,000.
- Eligible corporations must be taxable Canadian corporations with a permanent establishment in Manitoba.
- Corporations must apply for a Certificate of Eligibility (COE) before incurring eligible expenses.
grant_single_labels|contact
ecdevprograms@gov.mb.ca
204-945-2475
Apply to this program
Manitoba Interactive Digital Media Tax Credit Overview
The Manitoba Interactive Digital Media Tax Credit (IDMTC) is a refundable tax credit providing up to 40% on qualified Manitoba labour expenditures and certain marketing and distribution costs directly involved in the development of eligible interactive digital media products. This initiative aims to foster economic growth and job creation in Manitoba’s interactive digital media sector.
Detailed Explanation of the Manitoba Interactive Digital Media Tax Credit
The Manitoba Interactive Digital Media Tax Credit (IDMTC) supports the growth and innovation of the interactive digital media sector in Manitoba. This refundable corporate tax credit is a strategic initiative by the Manitoba government to fuel economic development, create job opportunities, and attract new investments in this burgeoning industry.
Eligibility Criteria for Corporations
To qualify for the IDMTC, both the corporation and the project must meet specific criteria. Eligible corporations must be taxable Canadian corporations either incorporated federally or provincially and must maintain a permanent establishment in Manitoba throughout the fiscal year during which the eligible expenses are incurred. This establishment is defined as a fixed place of business, assets used for project development, and personnel based in Manitoba who can contract on behalf of the corporation.
Corporations can apply for the tax credit under two conditions:
- For a 40% tax credit: The corporation must pay at least 25% of its total annual salaries and wages to Manitoba resident employees during the relevant year.
- For a 35% tax credit: If a corporation pays less than 25% of its total annual salaries and wages to Manitoba residents, it must incur at least $1,000,000 in eligible Manitoba labour expenses during the corporate year.
Eligible Products
An eligible interactive digital media product must be designed primarily to educate, inform, or entertain users through interactive media, involving at least two of text, sound, or images. Examples include video games, simulators, and e-learning products that provide non-linear media interactions where users actively participate rather than just read or view content.
Ineligible Products
Certain products do not qualify for the IDMTC. These include operating systems, hardware development, products used primarily for interpersonal communication or promotional purposes, adult-only (AO) rated video games, and products contrary to public policy.
Eligible Projects
There are two types of eligible projects:
- Development of an eligible interactive digital media product primarily for commercial use.
- Development or provision of a qualifying product add-on (project updates or enhancements) primarily for commercial use.
For commercial use implies generating revenue from an arms-length source, through sales, fees, or third-party advertising. Add-ons must enhance the existing product while continuing to generate revenue with the base product.
Eligible Expenses
Eligible expenses can only be incurred after the department receives an application for a Certificate of Eligibility (COE). These include development labour costs and certain marketing and distribution costs if the corporation owns the product’s intellectual property.
Development Labour Costs
Eligible development labour costs include:
- 100% of qualifying salaries, wages, project-related bonuses, and employee benefits paid to Manitoba employees of the applicant corporation.
- 65% of the Manitoba labour component of fees paid to qualifying third-party contractors.
Eligible expenses must be directly attributable to the development of an eligible product, paid to Manitoba residents, and incurred during the eligible project period.
Marketing and Distribution Costs
If a corporation owns the product's intellectual property, it may claim up to $100,000 in marketing and distribution expenses. Examples include costs related to advertising, trade show attendance, product displays, and direct mail campaigns.
Application Process
The application process consists of four steps:
- Contact the Department of Economic Development, Investment and Trade and apply for a Certificate of Eligibility before starting the project.
- Undertake the development work on the interactive digital media project.
- Submit eligible expenses to the province to receive a Tax Credit Certificate.
- File the Tax Credit Certificate with the Canada Revenue Agency.
Certificate of Eligibility
The Certificate of Eligibility (COE) is intended to provide an advanced ruling on the project's eligibility and an estimate of the tax credit amount. It does not guarantee the issuance of the Tax Credit Certificate but helps in planning and incurring eligible project expenses accordingly.
Tax Credit Certificate
A Tax Credit Certificate is issued based on actual eligible expenses incurred and paid by the qualifying corporation. This certificate is required to claim the tax credit with the Canada Revenue Agency and can be applied for at the end of each tax year or upon project completion.
Important Considerations
Should there be any changes to an ongoing project, corporations may apply for an Amended Certificate of Eligibility. It's also crucial to ensure that all documentation is accurate and submitted in a timely manner to meet Canada Revenue Agency’s filing deadlines.
Contact Information
For more details and to begin the application process, corporations can contact:
Interactive Digital Media Tax Credit
Economic Programs Branch
1010 – 259 Portage Avenue
Winnipeg MB R3B 3P4
Email: ecdevprograms@gov.mb.ca
Phone: 204-945-2475
Conclusion
The Manitoba Interactive Digital Media Tax Credit represents a significant opportunity for corporations in the interactive digital media industry to enhance their project viability and financial sustainability. By leveraging this tax credit, eligible corporations can reduce their taxable income, thereby reinvesting the savings into further innovation and growth. The Manitoba government’s commitment to fostering this sector underscores its potential to contribute significantly to the provincial economy, drive technological advancements, and position Manitoba as a leader in the interactive digital media landscape.
