Let us help you get the DGTO fast!
The cheat code is 1300 658 508
What is the Digital Games Tax Offset?
The Digital Games Tax Offset is a 30% tax rebate for video game development.
The aim of the Digital Games Tax Offset is to support business growth and change to the way Australian businesses can claim depreciation of intangible assets like intellectual property and in-house software.
Many of Australia’s game companies are independent studios, generating original IP. The massive global demand for games ensures a steady stream of work, including licensed property projects, ‘work for hire’ assignments, and multi-studio collaborations.
In 2021, a whopping 10% of games on Apple’s new Apple Arcade platform were crafted in Australia or New Zealand. Thanks to our timezone, Australian game development studios can keep the development wheels turning while North America and Europe rest, enabling a 24-hour development cycle.
Recent research reveals that the Australian video game development industry’s revenue has shot up to $226 million, a 100% increase since 2016.
Don’t be an NPC!
Call 1300 658 508
Assuming your company meets the eligibility criteria for the Digital Games Tax Offset and you’ve expended $750,000 on valid game development activities, here’s how you can calculate your cash rebate, thereby improving your profitability:
Identify Qualified Australian Development Expenditure (QADE): First, you must eliminate any expenditure that does not fall under the QADE. For instance, if $50,000 of the total expenditure was incurred on non-qualifying activities or was incurred outside Australia, your QADE for the tax offset would be $700,000 (that is, $750,000 minus $50,000).
Compute the Cash Rebate: After determining the QADE, apply the current tax offset rate, which stands at 30%. Therefore, your company would be entitled to a cash rebate of $210,000 (30% of $700,000) on your qualifying game development expenditure.
You don’t need to do this all yourself. There are experts that can do this.
or call 1300 658 508
Is your game eligible?
The eligibility of a digital game under the Digital Games Tax Offset (DGTO) scheme can be determined based on the following detailed criteria:
Definition of the Game: The digital game includes all electronic content (like coding), audio content (such as sound effects and soundtrack), non-interactive elements (like opening credit sequences and “cut scenes”), and underlying game technology. This encompasses game engines, physics engines, lighting, anti-cheating controls, game-related payment system architecture, and user interfaces. All these elements are considered part of the game.
Availability over the Internet: Eligible games must be made available for use over the internet. This can be through digital download or online subscription, and includes games that are played through the internet, like streaming or browser-based games. If a game meets these criteria, it can still be eligible even if it also has a single player “offline” mode. The game being physically available (e.g., for sale by disc at traditional retail outlets) does not impact its eligibility.
Availability to the General Public: The game must be developed to be made available to the general public. Games that are not sold or otherwise made accessible to the public are not eligible for the DGTO. This includes games used exclusively as in-house training tools or games limited to a specific location (like a specific shopping center, zoo, or museum) making them not effectively available to the general public. Also, incomplete games that have not been released are not considered eligible.
Inclusion of Incomplete Games: However, if an incomplete game has elements that eventually form part of an eligible game that is released to the public, the expenditure incurred in developing those elements may be claimable. This includes expenditure on R&D, prototypes, or other eligible expenses in relation to the new eligible game. But, there should be sufficient documentation to reasonably show (in the opinion of the Arts Minister) that those elements were eligible expenditures.
These games are ineligible for the DGTO
Games that are ineligible for the Digital Games Tax Offset (DGTO) are defined based on the following criteria:
Gambling Services: Any game that can be considered a “gambling service” under the Interactive Gambling Act 2001 (IGA2001) is ineligible for the DGTO. The definition of a gambling service includes services related to betting, conducting a lottery, supplying lottery tickets, and conducting a game played for money or anything of value. This extends to games that may not technically qualify as gambling under the IGA2001 but substantially comprise gambling or gambling-like practices, such as betting and wager mechanisms, casino-style games, in-game gambling, and buying chance-based items.
Loot Boxes: Games that rely on or prominently feature certain types of “loot box” mechanics, wherein players can purchase unknown virtual items determined by chance and potentially cash out these items for real-world currency or assets, are likely to be considered as incorporating gambling-like practices and thus ineligible.
Classification: A game that has been refused or is unlikely to obtain an Australian classification is not eligible for the DGTO. Classification can be refused based on elements like the promotion or instruction of crime or violence, depictions of actual or simulated sexual activity, and instruction or promotion of drug use. If a game hasn’t yet received its classification, the applicant may be required to provide additional information or obtain classification before a DGTO certificate can be issued.
Promotional Games: Games that are primarily developed to advertise or promote a product, entity, or service, despite being released to the general public, are ineligible for the DGTO. The determination of whether a game primarily serves a promotional purpose is based on a case-by-case assessment. Factors such as a lack of revenue stream might contribute to this assessment, but are not decisive.
Has your game actually been released?
To be eligible for the Digital Games Tax Offset (DGTO) under a Completion Certificate or a Porting Certificate, the digital game or port must be released to the general public, excluding for testing purposes.
The release must be genuine and accessible, such as through a digital store or subscription service.
- Self-published Games: For games published by the applicant company, the DGTO can be claimed for the income year in which the game or port was released to the public, excluding for testing purposes. A game released for testing, such as an open beta, is considered complete after 12 months. No Quality Australian Development Expenditure (QADE) can be claimed after the actual or deemed release date.
- Third-party Published Games: For games published by a third party, the applicant company becomes eligible for the DGTO under a Completion Certificate or a Porting Certificate when it first provides a version of the game to the third party that is ready to be released to the public.
- Ongoing Development: Ongoing Development Certificates apply to games that have already been released. Games released before 1 July 2022 are still eligible for the DGTO, but only development expenditure incurred from 1 July 2022 will be eligible. A game doesn’t need to have received completion or porting certificates under the DGTO to be eligible for ongoing development. The relevant income year for claiming the DGTO is the year in which the ongoing development occurred.
- Limited Releases: Pre-orders, limited pre-releases, or simply making game files available for download do not constitute a valid release to the general public.
What happens with the R&D tax incentive?
There exists an opportunity to claim both the Research and Development (R&D) tax incentive and the Digital Games Tax Offset, assuming that the activities claimed under each program are distinct and meet the respective eligibility criteria.
R&D Tax Incentive
The R&D Tax Incentive accommodates several kinds of activities, including:
- Technical enhancements to existing game engines or development of new ones
- Research into innovative hardware or software technologies for potential use in game development
- Creating unique algorithms or methodologies applicable to game development
- User research or playtesting aimed at improving game mechanics, design, or user experience
- Technical problem-solving during game development
- Development or refinement of game physics systems and multiplayer networking solutions
- Advancement of AI systems for game characters and VR or AR technologies for games
Digital Games Tax Offset
When it comes to the Digital Games Tax Offset, your company’s development expenditure on a digital game can encompass:
- Employee and independent contractor remuneration for those working on the game’s development. This can include software developers, UX designers and testers, game designers, writers, artists, animators, performers, musicians, sound designers, project managers, behaviour analysts, and quality assurance testers.
- Expenses related to research, prototyping, user testing, debugging, updating, and collecting user data for the game
- Expenditure on obtaining or maintaining a classification under the Classification (Publications, Films and Computer Games) Act 1995
- Expenditure on adapting the game for use on particular platforms
What can you claim under the DGTO?
When calculating Qualifying Australian Development Expenditure (QADE) for the Digital Games Tax Offset (DGTO), it’s crucial to distinguish between eligible and ineligible expenditure.
Eligible Expenditure includes:
- Software developers.
- Game designers.
- Content writers.
- Artists contributing visual elements.
- Musicians creating soundtracks.
- Project managers.
- Behaviour analysts studying user interaction.
- Quality assurance testers.
- Research activities.
- Creating game prototypes.
- The game testing phase.
- Bug fixing.
- Collecting user data.
- Updating the game.
- Obtaining a classification under the Classification (Publications, Films and Computer Games) Act 1995.
- Maintaining a classification under the Classification (Publications, Films and Computer Games) Act 1995.
- Adapting the game to specific platforms.
- Animators creating motion sequences.
- Performers contributing to voice and motion capture.
- Sound designers enhancing the game’s audio.
What expenses can you not include in the DGTO?
Under the Digital Games Tax Offset (DGTO), there are specific categories of costs that are not eligible for classification as development expenditure:
- Subcontracting Costs: Any expenditure on subcontracting by the entity engaged to develop the game
- Incidental Activities: Expenses on activities that are incidental to, but not directly attributable to, the development of the game, such as engaging social media managers, sales and marketing professionals, forum administrators, and moderators
- General Business Overheads: The company’s overall business overheads
- Non-Development Related Personnel: Expenditure on, or in connection with, engaging employees or contractors whose roles are not related to the development of the game, such as administrative employees, or those who were not Australian residents at the time the expenditure was incurred
- Travel and Hospitality: Expenditure on travel, accommodation, catering, entertaining, or hospitality
- Marketing and Advertising: Expenditure on marketing, advertising, publicity, or promotion for the game or company
- Hardware or Server Costs: Expenditure on computer hardware or servers, or the rights to access computer hardware or servers
- Land or Premises Use: Expenditure on the use of land or premises
- Intellectual Property Acquisition: Expenditure incurred to acquire copyright or a trademark, or a licence in relation to copyright or a trademark, other than in relation to engaging employees or contractors
- Financing Costs: Expenditure incurred by way of, or in relation to, the financing of the game
- Professional Services: Expenditure incurred in relation to insurance, audit services, accounting services, human resources, recruitment services, and legal services
- Double-Dipping with Other Offsets: Any expenditure claimed for the purposes of another tax offset, including for the purposes of section 355 100 (tax offsets for R&D)
- Notional Deductions: Expenditure that gives rise to notional deductions for the purposes of section 355 205 (deductions for R&D expenditure)
- Application Costs: Expenditure incurred in relation to applying for the DGTO, or any assistance programs administered by the Commonwealth or the States
- Non-Independent Entity Costs: Expenditure incurred in relation to an entity that is not wholly independent from the company
- Non-Arm’s Length Transactions: Expenditure incurred in connection with a transaction in which the company and another party to the transaction did not deal with each other at arm’s length
- Game Distribution: Expenditure on distributing the game
- User Acquisition: Expenditure on acquiring users for the game
- Software Acquisition or Licensing: Expenditure on acquiring or licensing software
How should you undertake apportionment?
When you’re managing your expenditures across different projects or activities, it’s important to only attribute relevant expenditures to the game or activity that’s subject to the Digital Games Tax Offset (DGTO) application. Here are some key guidelines to follow:
Contracted work across multiple games: If you’ve contracted an artist to create content for multiple games, you’ll need to split the total expenditure among the games. The amount allocated to each game should be reflective of the work done for that specific game in your DGTO application.
Employee tasks that include development and non-development activities: When an employee performs both development (qualifying as QADE) and non-development tasks, their expenditure should be apportioned between QADE and non-QADE activities for the purposes of the DGTO application.
Remember, you must keep adequate records (work orders, schedules, internal project management system reports, etc.) to support your apportionment. You can upload these documents in the Additional Information section of the application form.
Also, note that if an employee or independent contractor spends 90% of their time on activities that qualify as QADE, you don’t need to apportion their expenditure. For instance, if an employee spends 90% of their time developing an eligible game and the rest on general administrative duties, you can claim 100% of their expenditure.
Can you claim on-costs and overheads?
When evaluating expenditures for the Digital Games Tax Offset (DGTO), it’s also crucial to consider the inclusion of fringe benefits and compensation. Here are some key points to understand:
Fringe Benefits as QADE: If an eligible employee receives fringe benefits as part of their remuneration package (like a car instead of salary or wages), these may be considered as QADE.
Government Fees, Fines, Taxation: Any governmental fees, fines, penalties, taxation or similar payments (including Fringe Benefits Tax) are not deemed as ‘remuneration’ or ‘expenditure’. Therefore, they are not considered as development expenditure or QADE.
Compulsory Worker’s Compensation: If a person’s remuneration qualifies as QADE, any mandatory worker’s compensation associated with that remuneration and payable by the applicant company is also considered QADE.
Can you claim associate costs?
When considering the Digital Games Tax Offset (DGTO) and the treatment of costs associated with entities that are linked to the applicant company, the following aspects need to be understood:
Exclusion of Associate Costs: As a general rule, any expenditure relating to an entity that is an associate of the applicant company does not qualify as development expenditure and thus cannot be claimed as QADE.
Limited Exception: However, there is a limited exception to this rule. A company may claim up to $65,000 per income year under the DGTO for each influential employee or individual that performs work or services directly for the company, and these services are attributable to the development of the game. For instance, if a director, founder, or CEO of a game development studio also undertakes development work on a game applied for under a stream of the DGTO, up to $65,000 of their salary per income year can be claimed.
No Apportioning or Separating: Even with this limited exception, there’s no mechanism for apportioning or separating such expenditure to determine the amount of expenditure if the transaction had taken place between parties that are not associates.
- Definition of Associate: An associate of a company is defined by section 318 of the Income Tax Assessment Act 1936 (ITAA36). Legal advice should be sought regarding associates of your company before submitting your application.
Attachments to your DGTO application
To apply for the Digital Games Tax Offset (DGTO), you’re required to submit several key documents that are mandatory, with additional optional documents that can substantiate your Qualified Australian Development Expenditure (QADE) claim:
ASIC Extract: An ASIC company extract needs to be provided to verify that the applicant company is an Australian resident company, or a foreign resident company operating through a permanent establishment in Australia. This information should include the Australian Business Number (ABN) and details of the registered address.
Affiliates: Upload a list of all companies likely to be ‘connected with’ or ‘affiliates of’ the applicant at the time of lodgement of the relevant tax return, highlighting any particular ‘related companies’ that may also intend to claim an amount under the DGTO.
Associates: Include a list of all associates or potential associates with whom transactions have been undertaken relevant to QADE and, for potential associates, the rationale that has been used to determine the company is not an associate.
QADE Statement: Upload a statement of total QADE, ideally in the form of a general ledger.
Additional documents can be submitted to support your application and further substantiate your QADE claim. These might include:
- Employment Contracts: These contracts detail the relationship between your company and its employees. They often include information about the role, responsibilities, and compensation of the employee. For DGTO claims, these contracts can substantiate your expenditure on remuneration for game developers and other related roles in your company.
- Payroll Summary Details: A summary of your company’s payroll can give a clearer picture of how much you’re spending on employee wages. This can be especially relevant when demonstrating the costs associated with key roles in game development such as game designers, programmers, artists, animators, and producers.
- Invoices and Change Orders: These documents can provide a clear account of specific costs incurred during the development of the game. This could include expenditures related to research, prototyping, user testing and debugging, game updates, and platform adaptation.
- Letters of Engagement: These are typically used when your company contracts services from a third party. A letter of engagement outlines the understanding between your company and its service providers, including terms, conditions, and fees. In the context of a DGTO claim, this could include costs related to voice recording, music composition, or cut scene creation.
- Schedules, Timesheets, and Attendance Sheets: These documents can provide evidence of the work completed on the project and the time spent on the work. This could support your claim by verifying the hours devoted to research, game development, and other relevant activities.
- Relevant Quotes: Quotes can help support the valuation of goods or services provided in the course of game development. For instance, a quote for specific hardware or software necessary for the project can substantiate associated costs.
- Letters of Authorisation: These documents can demonstrate approval for certain actions or expenditures. For instance, if you have a letter of authorisation from a classification board, it can substantiate your expenditure on obtaining or maintaining a game classification.
- Foreign Currency Calculations: If your company has incurred any expenditure in a foreign currency, calculations or receipts showing the exchange rate applied at the time can be useful. This can help to accurately reflect the AUD equivalent of such expenditure in your claim.
- Major Service Providers’ Full Quotes and/or Budgets: Detailed quotes or budgets from major service providers can provide a more comprehensive understanding of your costs. This could include costs for major services like platform adaptation or unique game features development.
These documents, while not mandatory, can provide more substantial evidence for your QADE claims and might help streamline the review process.
You do cool games.
We do tax crap.
or call 1300 658 508
How long does it take to get a DGTO certificate?
The process for application assessment, including consideration by the Advisory Board, may take approximately 16 weeks.
or call 1300 658 508
What can we do to help?
Bulletpoint can assist you in maximising your benefits from the R&D tax incentive and Digital Games Tax Offset:
For the R&D tax incentive:
- Help you identify eligible R&D activities and expenses that can be claimed under the scheme.
- Provide guidance on the documentation required to support your R&D claim.
- Assist you in calculating your R&D tax offset or refund and determining the applicable tax rate.
- Provide support in the event of an audit or review by the ATO.
- Keep you updated on changes to R&D tax incentive legislation and regulations.
For the Digital Games Tax Offset:
- Help you identify eligible games development activities and expenses that can be claimed under the scheme.
- Provide guidance on the documentation required to support your claim, including the cultural test and expenditure calculation.
- Assist you in calculating your tax offset and determining the applicable tax rate.
- Provide support in the event of an audit or review by the ATO.
- Keep you updated on changes to Digital Games Tax Offset legislation and regulations.
In addition, we can help you accurately split your costs and activities between the two schemes to ensure that you maximise your benefits from both. We can also provide advice on other government grants and incentives that may be available to you, depending on your specific circumstances.
A company is entitled to the digital games tax offset)for an income year if:
- the Arts Minister has issued one or more certificates to the company
- the company claims the offset in its income tax return for the income year
To be eligible for the Digital Games Tax Offset you will need to be:
- limited to games on which at least $500,000 of qualifying expenditure has been spent
- capped at $20 million in claims per annum
- an Australian resident companies or foreign resident companies with a permanent establishment in Australia
- available in the year when the qualifying expenditure has ceased on a game
Games with gambling elements and games that would not be able to achieve classification will be ineligible for the Digital Games Tax Offset.
Call 1300 658 508
Types of Certificates
There are three different types of certificates for the DGTO. They are:
- Completion Certificate: a certificate for a digital game completed in the income year in respect of which the offset is claimed, with costs able to be incurred across one or more income years;
- Porting Certificate: a certificate for a digital game that has been ported in the income year in respect of which the offset is claimed, year, with costs able to be incurred across one or more income years; and
- Ongoing Development Certificate: a certificate in relation to ongoing development of one or more previously released digital game in the income year in respect of which the offset is claimed.
What about provisional certifcates?
If you’re in the process of developing a game, you might be considering applying for a provisional certificate. This certificate can provide an early indication of whether your game is likely to be eligible for the Digital Games Tax Offset (DGTO), based on the information you provide at that stage of development.
However, it’s important to note that applying for a provisional certificate is entirely optional. It’s not a mandatory step in the process of obtaining final certification. The assessment for the final application will be based on the information presented at the final certificate stage, not on whether a provisional certificate was issued.
A key point to remember is that not being issued a provisional certificate doesn’t stop you from applying for a final certificate for your game. Conversely, holding a provisional certificate doesn’t guarantee that the Minister will issue a final certificate for the DGTO. It also doesn’t prevent the Minister from deciding not to issue a certificate.
Interestingly, there’s no rule stating that a provisional certificate and a final certificate for the same game must be issued to the same entity. For instance, if a company takes over the development and completes a game for which a previous company had a provisional certificate, the new company can still apply for the final certificate.
You know what would be fun.
How to claim the DGTO?
To claim the Digital Games Tax Offset (DGTO), you must hold a certificate issued by the Minister or their delegate. This certificate confirms that your game meets the requirements of Division 378 of the ITAA97.
Key eligibility criteria include:
- The applicant is an eligible entity.
- The digital game/s applied for is/are eligible.
- The game has been completed or ported in the relevant income year, or ongoing development has occurred, depending on the certificate type sought.
- The Qualifying Australian Development Expenditure (QADE) meets the relevant threshold for the certificate type.
The certificate will detail the applicant company name, game title/s, QADE amount, and the income year for claiming the offset. You can then claim the DGTO in your tax return for that year. The Australian Taxation Office (ATO) will apply the DGTO against any existing tax liabilities and refund the remainder.
Choosing the Right DGTO Certificate
When applying for the Digital Games Tax Offset (DGTO), consider the following to choose the appropriate certificate:
Completion Certificate: Choose this if you’re developing a new game and have incurred or will incur at least $AUD500,000 in Qualifying Australian Development Expenditure (QADE). This applies even if you’re only developing a part of the game, as long as the entire game is completed and released to the public.
Ongoing Development Certificate: Choose this if you’re further developing one or more already released games and have incurred or will incur at least $AUD500,000 in QADE in a single income year. This includes activities to maintain, update, expand, or improve a completed digital game.
Porting Certificate: Choose this if you’re porting a completed game onto a new platform and have incurred or will incur at least $AUD500,000 in QADE. This is suitable when no other development work is being undertaken that would be eligible under another certificate.
How Bulletpoint Can Assist You with DGTO Certificates
We are a Melbourne-based consultancy, specialising in navigating the intricacies of various grants. With a decade of experience and a proven track record of over 500 successful R&D claims, we’re well-equipped to guide game developers through this complex process.
Here’s how we can assist:
Expert Guidance: We simplify the jargon, helping you understand the government’s definition of games and the specific requirements for each DGTO certificate – Completion, Ongoing Development, and Porting.
Uncovering Opportunities: Our clients often praise us for revealing grants they wouldn’t have otherwise known about. We can help identify your eligibility for the DGTO and ensure you meet the $500,000 QADE threshold.
Stress-Free Process: We aim to make the process less stressful, handling the complexities while you focus on game development.
Continuous Improvement: We learn from every piece of feedback, striving to improve our services. Our commitment to excellence is reflected in our average rating of 4.8 stars from over 250 Google reviews.
At Bulletpoint, we blend professionalism with personality, providing accessible expertise to ensure your journey through the DGTO process is not just successful, but also enjoyable.
- Digital Games Tax Offset – Guidelines
- Digital Games Tax Offset – Application Form
- Digital Games Tax Offset – General Ledger
The Government has taken more than a year to get this right and they still can’t.
Do you expect this to be an enjoyable process. Ha!
What is a game developer?
A game developer is a specialised software developer with a focus on video game creation. They can specialise in creating games for specific consoles like Nintendo’s Nintendo Switch, Microsoft’s Xbox One, Sony’s PlayStation 4, or they may design for multiple platforms such as personal computers and mobile devices. Depending on their area of expertise, they could specialise in different genres of games like role-playing video games or first-person shooters. Some game developers work on porting games from one system to another, or translating games from one language to another. In rare instances, they may also engage in non-gaming software development.
Understanding the Industry Players:
First-Party Developers: In the video gaming landscape, a first-party developer is an integral part of a company that manufactures a video game console and develops games exclusively for it. They can either operate under the company’s name, like Nintendo, operate as a specific division, like Sony’s Polyphony Digital, or they could be an independent studio that was later acquired by the console manufacturer, such as Rare or Naughty Dog.
Second-Party Developers: The term “second-party developer” is often used in the gaming community and media to describe game studios that take on development contracts from platform owners and create games exclusive to that platform. These developers are not owned by the console manufacturer, but create games exclusively for them. To compensate for the exclusivity, they are generally offered higher royalty rates than third-party developers.
Third-Party Developers: A third-party developer can also publish games or work under a video game publisher to create a game. Both the publisher and developer have significant say in the game’s design and content, but the publisher’s preferences usually take precedence.
Call 1300 658 508
The Digital Games Tax Offset opens from 1 July 2022.
These are some case studies provided by the government:
- Sledgehammer Games – Sledgehammer Games, creators of the renowned Call of Duty franchise, has successfully established its first development studio outside the US, right here in Australia. Since its launch in 2019, the company swiftly grew from just six people to over 80 talented developers and creatives. Chief Operating Officer, Andy Wilson, credits Australia’s supportive atmosphere and outstanding talent pool for facilitating this impressive growth. Keen on giving back, Sledgehammer Games is committed to cultivating Australia’s gaming industry through internships and mentoring programs. They’ve also nurtured relationships with both industry and government bodies to further support game development. With their ongoing growth plans and proactive approach to supporting the industry, Wilson envisions a bright future for Sledgehammer Games in Australia.
- Extradimensional Enterprises – Extradimensional Enterprises, originally based in London, eyed Australia as a promising locale for expansion. With the country’s deep talent pool and strong infrastructure, it seemed a natural fit. Harnessing the advantages of the Digital Games Tax Offset, the international gaming company set up an office in Australia. This move attracted talented professionals like Leo, an Australian programmer who returned home to work in the exciting gaming industry. Their significant investment in a new augmented reality game and platform has not only proved successful but has also facilitated local health research related to mobility in older Australians.
- Mighty Kingdom – South Australian gaming company, Mighty Kingdom, is a creator of games for a roster of the world’s leading entertainment brands, including Disney, LEGO, and Sony. Listed on the Australian Securities Exchange in 2021, they are a prominent player in the gaming industry, employing 120 people. As they navigate the global gaming market, projected to reach US$200 billion by 2023, Mighty Kingdom is also keen on bolstering Adelaide’s games ecosystem, contributing to skills development and attracting both local and international investors.
- House House – House House, an independent studio based in Melbourne, made global headlines in 2020 with their hit creation, Untitled Goose Game. The game quickly became a sensation, selling over a million copies in its first three months, and clinching major international awards including the DICE Game of the Year and the BAFTA Award for Best Family Game.
Imagine if you just developed your game than trying to understand this?
Call 1300 658 508
Top made games in Australia
The cheat code is
Go watch 10 minutes of credits
We like games too!
What other info might you have to provide?
The applicant company must provide the following to the NFSA upon request, after a final certificate under the DGTO is issued:
Launch Copy: A launch copy of the game in an accepted format as outlined on www.classification.gov.au.
Gameplay Footage: At least 30 minutes of gameplay footage from the published version of the game, supplied in the highest resolution format available.
Soundtrack: The game’s soundtrack delivered as uncompressed files.
Physical Release Materials: If applicable, physical game release materials including collectors’ editions and published soundtracks.
Publicity Material: This could include trailers, development diaries, production documentaries, and high-resolution game and box art.
Press Kit: A press kit that details the game’s features and production.
Game Credits and Biographies: Game credits, and biographies of key production personnel, if not already included within the press kit, supplied as PDF(s).
Behind-The-Scenes Material: This could include concept or storyboard art.
Promotional Material or Merchandise: Any additional promotional material or merchandise associated with the game.
The Albanese Labor Government has appointed Johanna Egger and Morgan Jaffit to the Digital Games Tax Offset Advisory Board for three-year terms. This board was established earlier this year to oversee the Digital Games Tax Offset (DGTO), which offers a 30% refundable tax offset to eligible game developers investing a minimum of $500,000 in qualifying Australian development expenses. Its primary role is to provide guidance to the government regarding applications for the DGTO.
Johanna Egger, the Managing Director of Family & Kids at Two Bulls/DEPT and an industry veteran with numerous accolades, will bring her extensive experience to the board. Morgan Jaffit, a founder and Director of Australian game studios Spitfire Interactive and Defiant Development, with over two decades of experience in game development across various platforms, will also contribute to fostering the growth and development of the dynamic digital games industry in Australia. These appointments reflect the government’s commitment to supporting and sustaining the country’s game development sector, one of the fastest-growing industries in Australia.
In an impactful development, the recently introduced Victorian Digital Screen Rebate is poised to amplify the prospering digital games, VFX, and animation sectors. The rebate is geared towards invigorating projects located in Victoria, while also providing job opportunities for local talents.
Administered by VicScreen, this rebate complements the Australian Government’s recently initiated Digital Games Tax Offset and the Post, Digital and Visual Effects Offset. This collaboration aims to empower local studios, assisting them in maintaining a strong presence in the global market and further cementing Victoria’s role as a pioneer in screen innovation and technology.
This innovative initiative is in line with recent investments in the screen sector, demonstrating Victoria’s dedication to cultivating a robust digital screen industry. Notably, it complements support for home-grown projects, the establishment of Docklands Studios Melbourne’s virtual production infrastructure, and the introduction of vocational training for the digital screen field.
According to Liam Esler, Managing Director and Co-Founder of Summerfall Studios, “The Victorian Digital Screen Rebate will be a game-changer for local studios, equipping them with the necessary resources to create exceptional projects. This rebate paves the way for growth and encourages more studios to establish their presence in Victoria.”
This strategic move not only promises to bolster Victoria’s reputation as Australia’s premier games hub but also propels the digital screen industry toward a future brimming with innovation and prosperity.
Great news – the Digital Games Tax Offset (DGTO) application portal is now live at: Digital games | Office for the Arts
Companies can apply for completion, porting and ongoing development certificates for their eligible games, to claim the offset through a relevant income tax return; or apply for provisional certificates for games in pre-production and development, to receive an indication as to likely eligibility for the DGTO.
In addition to the application portal, program support materials are available, including program guidelines which detail the application and certification process. There is also a glossary, which is an A-Z of items that can and cannot be claimed as qualifying Australian development expenditure under the DGTO.
Review the DGTO Factsheet which offers a comprehensive overview of the scheme, including information on the application and certification process.
The peak games industry body in Australia has released a report that shows the games industry in the country is doing incredibly well, almost doubling in size in the last six years.
The Interactive Games and Entertainment Association (IGEA) released the results of the sixth annual Australian Game Development Survey. IGEA says that over 770 new jobs were created in the games industry in the last year alone. The industry has grown to include 2104 full-time employees across every state, with 73% of studios having staff in multiple locations.
Game developers welcomed the new tax offset, the Digital Games Tax Offset or DGTO, when it was introduced to parliament by the Albanese government last month. The new law would, when passed, offer a 30% tax offset to Australian developers working on projects with a budget of $500,000 or more.
The Digital Games Tax Offset, which will allow Australian games developers access to a 30% rebate on projects costing up to $500,000, has been officially introduced to Parliament.
The Australian Government passed the Treasury Laws Amendment (2022 Measures No. 4) Bill 2022 in the House of Representatives in November 2022, bringing the DGTO into effect.
The bill has received its first reading in the House of Representatives. Its second reading has been moved to an unknown date, and the debate on it adjourned for now. The bill is expected to sail through both houses of Parliament, with little doubt that it will become law.
If it passes both houses of Parliament, the Digital Games Tax Offset will become one of the largest game development incentives in the world. It will follow other incentives, like Screen Australia’s Games: Expansion Pack program into law, becoming part of a larger, better deal that will help expand the design ambitions of game devs here at home. Indeed, spurred by further state elections, governments around the country have begun introducing bigger and better incentive packages over the last year.
The Dublin-based games studio, Keywords Studios, is set to open 2 new game-development studios in Australia.
The company is well-known as a contributor to major digital games including Fortnite, Mortal Kombat and Halo.
Keywords Studio says that new facilities will create jobs for skilled games workers. The company aims to hire 30 new employees. The company’s 2 new studios in Australia will be known as Tantalus North in Brisbane and Tantalus South in Adelaide.
The Albanese Labor Government is backing in the digital games sector by introducing legislation to establish a Digital Games Tax Offset. A 30 per cent refundable tax offset will be available to eligible games developers that spend a minimum of $500,000 on qualifying Australian development expenditure.
Minister for the Arts, Tony Burke, said the Offset will promote the growth of Australia’s digital games development industry. It will increase market share in the rapidly expanding global sector, and incentivise the industry’s growth here in Australia.
The legislation will form part of the Income Tax Assessment Act 1997, which already provides incentives to the screen sector. In Australia, game development studios generated $226.5 million of income and employed 1,327 fulltime workers in 2020-21.
A tax credit for digital games has been proposed in draft legislation that has been made available for public comment. New digital game developers would need to spend at least $500,000 on development. This does not imply that any digital game or extension of an existing one will be eligible.
The draft legislation calls for a digital tax offset to go into effect on July 1 of this year. There is a cap on the offset, so if any company has an offset total that is greater than $20 million, the offset will be capped.
Frequently Asked Questions
The digital games tax offset (DGTO) is a refundable tax offset that allows eligible Australian companies that develop digital games to claim 30% of their total qualifying Australian development expenditure (QADE).
The DGTO is available for completion, ongoing development, or porting of digital games, and is subject to a number of eligibility criteria, including a minimum expenditure of $500,000. The DGTO is capped at $20 million per company (or group of companies that are connected or affiliated) per income year.
The DGTO is also referred to as a tax rebate for games in Australia, as it is a refundable tax offset. This means that if a company has no tax liability, they can still receive the offset as a cash payment from the Australian Taxation Office (ATO).
Yes, the DGTO is available for games developed and released in Australia from 1 July 2022.
The DGTO is one of a number of tax relief measures available for game developers in Australia. Other measures include the Screen Australia Games Expansion Pack, which provides funding for games with budgets below $500,000.
The DGTO is not a tax in itself. It is a refundable tax offset that allows eligible game developers to claim a percentage of their qualifying expenditure back from the ATO.
The DGTO is the tax rebate for games in Australia. It is a refundable tax offset that allows eligible game developers to claim 30% of their qualifying Australian development expenditure back from the ATO.
To claim the DGTO in a financial year, you must:
- Be an Australian company with an Australian business number (ABN), or a foreign company with a permanent base in Australia with an ABN
- Have one or more certificates from the Minister for the Arts that say you can get the DGTO and your total QADE for the financial year
- Claim the offset in your company tax return for the financial year.
Applying for a certificate from the Minister for the Arts
A company (or the main company in a group) can ask for a certificate from the Minister for the Arts for:
- Making a new game
- Moving a game to a new platform
- Continuing to develop an existing game.
To ask for a certificate and to learn more about who can get one, go to the Office for the Arts website.
Linked companies and groups
If your company is part of a group, the main company in the group can:
- Ask for the certificate or certificates from the Minister for the Arts
- Claim the DGTO in its tax return.
The annual $20 million limit applies to the offset for a single company and to the total amount of offset that a group of linked companies or groups can get.
After you get a certificate from the Minister for the Arts, you can claim the DGTO in your company tax return in the calculation statement at label E – Refundable tax offsets.
You can claim a refundable tax offset of 30% of the QADE listed in the certificates given to you for that financial year (up to the $20 million limit across linked companies).
Claiming the DGTO across linked companies
If you have any linked companies, make sure the total of all the DGTO amounts being claimed is no more than $20 million in a financial year.
If the total DGTO claimed by you and your linked companies is more than $20 million in a financial year, the offset is zero for all linked companies.
If you accidentally go over the $20 million limit in a financial year because you made a mistake working out if another company is a linked company, get in touch with us. You might be able to submit a change to the DGTO claim.
The Minister for the Arts can cancel a certificate.
If this happens, you’ll need to pay back any DGTO your company got from that certificate.
The Minister for the Arts can cancel the certificate if:
- The certificate was given based on wrong information
- There was fraud or serious misrepresentation
- The total of the company’s QADE on the game is less than $500,000 in the relevant financial year.
If the Minister for the Arts cancels a certificate or refuses to give a certificate, you can ask for a review in the Administrative Appeals Tribunal (AAT).