NL — Interactive Digital Media Tax Credit
NL, Canada
Tax credit for interactive digital media production in Newfoundland and Labrador
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|maxCount
- grant_single|projectCostPercent
grant_single|deadlines
- grant_single|openingDateJanuary 01, 2015
- grant_single|closingDateDecember 31, 2024
grant_single|financingType
Tax Credits
grant_single|eligibleIndustries
- Information and cultural industries
grant_single|grantors
- Government of Newfoundland and Labrador
grant_single|status
grant_card_status|open
grant_single_labels|preview
Get a refundable tax credit of 40% for costs of labour related to producing interactive digital media in Newfoundland and Labrador.
grant_single_labels|projects
This grant is primarily available for companies with a permanent establishment in Newfoundland and Labrador. The eligibility is based on the company's fixed place of business being located within this province.
- Companies with a permanent establishment in Newfoundland and Labrador.
grant_single|admissibleProjectsExample
$160,000
Toronto
Development of a language learning app with interactive exercises
$168,000
Halifax
Creation of an augmented reality app for historical education
$220,000
Edmonton
Creation of a multimedia training tool for early childhood education
$220,000
Ottawa
Deployment of an interactive digital storytelling platform for indigenous history
$200,000
St. John's
Development of an educational VR simulator for medical training
$360,000
Vancouver
Design and deployment of a VR experience to explore marine biology
grant_single_labels|admissibility
To be eligible for the Newfoundland and Labrador Interactive Digital Media tax credit, a corporation must meet the following criteria:
- Primarily carry on the business of interactive digital media development.
- Have a permanent establishment in the province of Newfoundland and Labrador.
- Be incorporated under the Corporations Act or an Act of the Parliament of Canada or another Canadian province.
- All or part of its income must not be exempt from taxation under Part I of the federal Income Tax Act.
- Hold a valid registration certificate under the Interactive Digital Media program.
grant_eligibility_criteria|who_can_apply
Eligible applicants for the Newfoundland and Labrador Interactive Digital Media (IDM) Tax Credit include corporations that primarily carry on the business of interactive digital media development. Specifically, the applicant must:- Be an eligible corporation, meaning it primarily carries on the business of interactive digital media development.- Have a permanent establishment in the province of Newfoundland and Labrador (NL).- Be incorporated under the Corporations Act or an Act of the Parliament of Canada or another Canadian province.- Ensure that all or part of its income is not exempt from taxation under Part I of the federal Income Tax Act.- Hold a valid registration certificate under the IDM program. Eligible corporations are those with a fixed place of business in NL, as determined by Regulation 400(2) of the Income Tax Act (Canada). The presence of a permanent establishment will be evaluated by the Department of Finance.
grant_eligibility_criteria|who_cannot_apply
The IDM tax credit exclusion criteria stipulate that certain products are not eligible, particularly those primarily aimed at communication, promotion, or non-interactive use. Restrictive measures ensure alignment with the grant's focus on interactive educational, informational, or entertainment media.
- Products primarily used for interpersonal communication.
- Products primarily used for marketing or promotional purposes.
- Products likely to receive an "AO" rating by the Entertainment Software Rating Board.
- Products that enable gambling activities with real currency.
- Content aggregators and search engines.
- Products providing content such as news, public affairs, advice, blogs, or financial market reporting.
- Websites, unless primarily hosting digital games, virtual or augmented reality experiences, or educational products.
grant_eligibility_criteria|eligible_expenses
The Newfoundland and Labrador Interactive Digital Media (IDM) Tax Credit supports projects that prioritize interactive digital media development with educational, informative, or entertainment value. Eligible activities encompass the creation of innovative digital platforms and applications that engage users through interactive experiences.
- Development of video games that integrate text, sound, and images for an interactive experience.
- Creation of educational software designed to engage users through feedback, control, and adaptability.
- Design of training simulators intended for use in educational or professional environments, providing interactive user experiences.
- Production of virtual or augmented reality experiences intended for educational or entertainment purposes.
grant_eligibility_criteria|zone
Eligible expenses for the Newfoundland and Labrador Interactive Digital Media Tax Credit include costs directly related to the salaries and remuneration involved in the creative development of IDM products.
- Eligible salaries for employees actively participating in the creative development of an interactive digital media product.
- 65% of eligible remuneration paid to another company for services employed in the development of an IDM product, which would qualify as eligible salaries if directly paid to an individual.
grant_single_labels|criteria
grant_single_labels|register
- Step 1: Obtain Registration Certificate
- Submit an application for registration under the IDM program through the NL Film Development Corporation.
- Receive preliminary feedback on the potential eligibility of the project.
- Enhance application based on provided feedback to increase approval chances.
- Await approval from the Minister of Finance, who has the final decision on project eligibility.
- Step 2: Apply for Tax Credit Certificate
- Submit an application to the Minister of Finance for a tax credit certificate within 18 months after the end of each taxation year.
- Complete the application using the required form and ensure it is signed by an authorized company officer.
- Step 3: Claim Tax Credit
- Receive the tax credit receipt upon approval, indicating that all requirements have been met.
- Claim the tax credit on the designated line of the T2 return for the relevant year using the information from the receipt.
grant_single_labels|otherInfo
Here are additional relevant details for this grant:
- The tax credit is refundable, offering financial support after accounting for taxes payable.
- Permanent establishment criteria are evaluated based on Regulation 400(2) of the Income Tax Act (Canada).
- Eligible projects must obtain a registration certificate from the Tax Administration Division under the IDM program.
- For government projects, the credit is claimed post-completion and specific conditions apply for expenses incurred before November 8, 2019.
- The Minister of Finance holds the authority to revoke or suspend certificates based on compliance and eligibility factors.
Apply to this program
Maximize Your Funding with the Newfoundland and Labrador IDM Tax Credit
The Newfoundland and Labrador Interactive Digital Media (IDM) Tax Credit offers crucial financial support to businesses engaged in developing interactive digital media products within the province. This refundable tax credit can significantly alleviate financial burdens, propelling innovation and development within the digital media industry.
Detailed Insights into the Newfoundland and Labrador IDM Tax Credit
The Newfoundland and Labrador IDM Tax Credit is a strategic initiative designed to bolster the province's burgeoning digital media sector by providing tangible financial incentives to qualifying corporations. This refundable credit targets companies engaged in creating interactive digital media products, allowing them to recoup a substantial portion of their incurred eligible expenditures. Under this program, qualifying companies can receive a refund equivalent to 40% of eligible spending on salaries and remuneration linked to the creation of interactive digital media products. The program is designed not only to ease the financial strain on businesses but also to stimulate economic growth by nurturing creative industries crucial to the digital economy.
The eligibility for this credit demands that corporations are actively contributing to the field of interactive digital media and are located within Newfoundland and Labrador. Ensuring that the company has a permanent establishment in the province is crucial, alongside meeting specific federal and provincial tax obligations, and the necessity of holding a valid registration certificate under the IDM program. Eligible corporations benefit immensely as they can offset their tax liabilities, making more funds available for reinvestment into further development and expansion. By supporting up to $40,000 in tax credits per eligible employee annually, with an annual cap of $2 million per company, the tax credit provides a robust framework to sustain businesses in the competitive digital marketplace.
Furthermore, the tax credit is customizable to align with the company’s own development timelines. While most claims are processed within the fiscal year the expenses were incurred, projects primarily developed for government use offer an extended timeframe, enhancing the operational flexibility for producers involved in different types of projects. This approach not only nurtures private investment in key technological developments but also encourages collaboration with governmental agencies, broadening the potential impacts of eligible projects.
Primarily focused on products intended to educate, inform, or entertain, the eligibility of the products hinges on their interactive usage, encompassing elements like text, sound, and images, combined to create enriching participatory experiences for users. This emphasis on interactivity ensures that funded projects remain relevant in offering engaging and innovative content that resonates well with modern technology users.
To access the tax credit, businesses must undertake a two-part application process, initially securing a Registration Certificate and subsequently a Tax Credit Certificate from the Department of Finance. This structured application procedure helps streamline eligibility confirmations and tax credit approvals, allowing businesses to plan their financing with a degree of certainty.
Overall, the IDM tax credit fosters a conducive environment for advancing technological development in Newfoundland and Labrador, encouraging companies to stake out creative digital ventures while mitigating financial risk. It strengthens the local economy by attracting and retaining digital talent within the province, ultimately contributing to sustainable economic growth. Through this strategic tax incentive, Newfoundland and Labrador can continue to be a promising ground for innovation in digital media, offering a competitive edge to businesses in the industry.
