Law introducing the Digital Games Tax Offset (DGTO) received royal assent on Friday, 23 June 2023. This has been added as Division 378 to the Income Tax Assessment Act 1997 (ITAA 1997).
The DGTO provides eligible game developers with a 30% refundable tax offset for qualifying Australian development expenditure from 1 July 2022.
It will be available for completion, ongoing development or porting of digital games, subject to:
- eligibility criteria set out in Division 378 of the ITAA 1997, including certification by the Arts Minister
- at least $500,000 of qualifying expenditure.
The offset is capped at $20 million per company (or group of companies that are connected or affiliated) per income year. Reaching this cap would require approximately $66.7 million in eligible expenditure.
Applicants must be either:
- an Australian resident company with an Australian business number (ABN)
- a foreign resident company with a permanent establishment in Australia and an ABN.