What is the Digital Games Incentive?
The Digital Games Incentive is an initiative which aims to attract game development projects to Queensland and encourage further growth in the local sector. This incentive is designed to support local developers, as well as international game companies looking to establish a new studio in Queensland to expand their business.
The Screen Queensland Digital Games Incentive aims to attract game development projects to Queensland and support further investment and growth in existing local game developers and studios.
The objectives of the Incentive are to:
- increase game publisher engagement with independent Queensland game developers;
- incentivise game companies interested in establishing or growing a presence in Queensland;
- create employment and skill development opportunities for Queensland game; and
- to equitably support the games industry in Queensland by providing incentives to as large a number of games entities as possible.
Applicants with projects that are eligible for the Incentive may also be eligible for funding through other Screen Queensland programs.
The Incentive is calculated at up to fifteen percent (15%) of qualifying QGDE and may be subject to a cap.
The final Incentive amount will be at the absolute discretion of Screen Queensland and is subject to factors including the availability of funding at the time of application, the total funding available for the Incentive and the total number of qualifying applicants.
The Incentive will be administered with the objective of equitably supporting the games industry in Queensland and providing incentives to as large a number of games entities as possible.
The Incentive is available to game developers, publishers and studios with game projects that:
- are spending a minimum of AU$250,000 on qualifying Queensland Game Development Expenditure (QGDE);
- have a development team made up of Genuine Queensland Residents. Screen Queensland defines this as a person or company who has been resident in Queensland for at least 2 months.
The following game formats are eligible to receive the Incentive:
- entertainment games;
- premium and free-to-play games;
- live-ops development;
- games for mobile phones, PC/Mac, Consoles, VR/AR; and
- games intended for public release.
The following are ineligible to receive the Incentive:
- games that are not completely digital (boardgames or hybrid digital/physical games);
- gambling games;
- games that are, in Screen Queensland’s opinion, likely to be refused classification under the Classification (Publications, Films and Computer Games) Act 1995;
- games designed to, in Screen Queensland’ opinion, predominantly or substantially market, promote or advertise a product or service;
- games designed primarily for educational or training purposes.
Only one company may apply for the Incentive per game.
Qualifying spend may occur over a period of two (2) years maximum. Multiple games cannot be bundled to reach the minimum $250,000 spend, however, multiple updates of the same game can be bundled.
If a studio has two separate games in development, they may apply for individual incentives for each game.
Applicants with games that are still in development after reaching the two (2) year maximum period may reapply for the incentive.
Qualifying QGDE is based on game development costs incurred in Queensland, including:
- wage-related costs for full-time, part-time and contractor developers working directly on the project – these developers must be genuine Queensland residents;
- wages paid to marketing coordination, quality assurance, localisation and other game support staff working on the project; and
- other general overheads, however, this should not exceed 5% of the total QGDE and must be spent in Queensland.
Applications open on an ongoing basis.
Update – 20 July 2022
The Digital Games Tax Offset (DGTO) was announced as part of the 2021-22 Budget. As a tax rebate, the DGTO will form part of the Income Tax Assessment Act 1997. An exposure draft bill and explanatory statement was open for public consultation from 21 March 2022 to 18 April 2022. The consultation process has now completed, however the draft materials are still available for review on the Treasury website.
As the legislation has not yet passed parliament, the DGTO is not yet up and running. However, once the legislation comes into effect, the DGTO will be claimable for expenditure incurred from 1 July 2022, providing a 30 per cent refundable tax offset for eligible businesses that spend a minimum of $500,000 on qualifying Australian development expenditure (QADE). As described in the exposure draft legislation, QADE will include costs directly related to the development of eligible games, such as salary and wages. Eligible businesses must be an Australian resident company or foreign resident company with a permanent establishment in Australia. Games development studios will be able to claim per-project for new eligible games, and annually for a slate of further work (‘live ops’) done on existing/released eligible games across the financial year. Games with gambling elements and games that would not be able to achieve classification will be ineligible for the DGTO.
Until the legislation passes through Parliament and comes into effect, there no additional guidance about applying for and claiming the DGTO. The DGTO will apply retrospectively. This means if and when the legislation comes into effect, the DGTO will be claimable for expenditure incurred from 1 July 2022 (even if the legislation was not passed until a later date). The Government’s legislation program is currently being developed and I am unable to advise timing for the DGTO to be considered by Parliament.
Most current information and updates, including guidance materials and details about how to apply, will be made available on the Office for the Arts website promptly after legislation has come into effect: www.arts.gov.au.