Great news for game developers. The Australian Government has given the green light to the Digital Games Tax Offset (DGTO). If you’re a game development company based in Australia, whether you’re from around the corner or across the world, this could be your golden ticket to save money.
Applying retrospectively from July 1, 2022, the DGTO lets game studios tap into a loot box of tax savings. If you’ve spent at least $500,000 on your game-related adventures, you could be eligible for a 30% refundable tax offset. The government’s giving you your spending back, just like that.
The DGTO magic is managed by the Office for the Arts and the Australian Taxation Office (ATO). They’re the wizards who’ll make sure everything’s in line with the Income Tax Assessment Act 1997.
But wait, there’s a bit of a treasure hunt here. To get your offset in your tax return, you will need to ask the Arts Minister for a special certificate, depending on what kind of game development you’ve been up to.
If you’ve successfully created a new digital game, you get a Completion Certificate. If you’ve taken your already-awesome game and made it work on a whole new platform, that’s a Porting Certificate. And if you’re keeping the magic alive with updates and improvements, you’re in for an Ongoing Development Certificate.
What is covered
Now, what counts as spending? Well, almost anything that’s connected to your game’s journey to life. Whether you’re paying your team members or independent contractors, it’s all part of the plan. It can also include the money you spend on research, prototyping, and testing counts. Of course also the game technology that’s holding everything together.
But, there’s a small catch. You can’t have it all. If you’re already dipping into the Research and Development Tax Incentive jar (which can be as much as 43.5% off!), you can’t double-dip with the DGTO for the same expenses. It’s like having too much of a good thing.
The Australian Government is turbocharging Australia’s video game scene, which is gearing up to bring in $1 billion every year by 2030. Plus, they’re going to create around 10,000 new jobs for the nation’s talented game makers.
So, game on! It’s a win-win that even your favourite video game characters would envy.
Get more information about the DGTO here.