At first glance, the Ontario Interactive Digital Media Tax Credit, or OIDMTC, has extremely broad applicability. As per the eligibility criteria, and product that either educates, entertains or informs, and has some combination of images, text or sound may be eligible under the program. However, there are a number of caveats with respect to eligible products that must be considered before undertaking an OIDMTC claim.
1. Corporate Education – Products that intended to help educate people on how to perform their work tasks are generally not eligible. What this means is that developing a website that can educate a company’s employees on how to perform particular tasks, what forms to complete etc., even though they may be interactive and inform, are generally ineligible under the OIDMTC. That being said, a product made available to end-users (e.g. the public) that can educate them about a particular profession (e.g. Learning how to code) may be eligible.
2. Advertising – Interactive products that are designed to sell or advertise another product are also generally ineligible to be claimed under the OIDMTC. For example, if you are developing a widget and have developed a website to describe how to use the widget and sell it, it may not be eligible. Even though the product may educate, entertain or inform, and meets the interactivity requirement, it will come up against the advertising caveat.
3. Content – The OIDMTC is geared towards companies producing interactive content. What this means is that the product must contain text, audio or video that has been created by the company, not its users. At least 50% or more of the product must contain content that is created by the developing company. As a result, creating applications based on social content, or facilitate the content creation process (i.e. user generated comments, pictures, video, communication applications etc), will not meet the eligibility criteria of this program. While an eligible product may have a social component, the product must have content created by the developer.
If you are creating video games, e-learning products, online informational and educational sites, webisodes etc., it is important to keep the caveats above in mind. Being proactive to ensure that you meet the criteria is simple, and at MCN we can help you determine your eligibility and ensure that you receive the maximum from the program while maintaining compliance. Should you have any questions regarding the program and how we can help, please contact us.