Treasury Laws Amendment (2022 Measures No. 4) Act 2023 (29 of 2023)
Schedule 1 Digital games tax offset
Income Tax Assessment Act 1997
2 After Division 376 of Part 3-45
Insert:
Division 378 - Digital games (tax offset for Australian expenditure on digital games)
Table of Subdivisions
Guide to Division 378
378-A Tax offset for Australian expenditure in developing digital games
378-B Qualifying Australian development expenditure
378-C Certificates for digital games tax offset
378-D Review and other matters
Guide to Division 378
378-1 What this Division is about
Companies may be entitled to a refundable tax offset in relation to qualifying Australian development expenditure incurred in completing or porting a digital game, or carrying on ongoing development of digital games in an income year.
This offset is designed to support the growth of the digital games industry in Australia by providing concessional tax treatment for Australian expenditure.
One of the requirements for entitlement to the digital games tax offset is that the company must be issued with a certificate in respect of the completion, porting or ongoing development of a digital game. The certificate specifies the amount of qualifying Australian development expenditure determined by the Arts Minister in respect of the completion, porting or ongoing development of the digital game.
The amount of the refundable tax offset for an income year for a company is up to 30% of the sum of the determined totals of qualifying Australian development expenditure specified in certificates issued to the company for the income year.
Subdivision 378-A - Tax offset for Australian expenditure in developing digital games
Table of sections
378-10 Company entitled to refundable tax offset for Australian expenditure incurred in developing digital games
378-15 Amount of digital games tax offset
378-20 Meaning of digital game
378-25 Arts Minister must issue certificate for the digital games tax offset
378-30 Arts Minister to determine a company's qualifying Australian development expenditure for the digital games tax offset
378-10 Company entitled to refundable tax offset for Australian expenditure incurred in developing digital games
(1) A company is entitled to a *tax offset under this section (the digital games tax offset ) for an income year if:
(a) the *Arts Minister has issued one or more certificates to the company for the income year under section 378-25 (certificate for the digital games tax offset); and
(b) the company claims the offset in its *income tax return for the income year; and
(c) the company:
(i) is an Australian resident that has an *ABN; or
(ii) is a foreign resident that has a *permanent establishment in Australia and an ABN;
when the company lodges the income tax return and when the tax offset is due to be credited to the company.
Note: The digital games tax offset is a refundable tax offset: see section 67-23.
(2) The claim referred to in paragraph (1)(b) may be varied to take account of a variation under subsection 378-15(5) of a notice given under subsection 378-15(3) by the company in relation to the income year. Otherwise, the claim is irrevocable.
378-15 Amount of digital games tax offset
(1) Subject to subsection (2), the amount of the digital games tax offset for a company for an income year is the lower of:
(a) 30% of the sum of all the amounts determined by the *Arts Minister under section 378-30 that are specified in certificates issued to the company for the income year under section 378-25; and
(b) $20,000,000.
(2) If the sum of the amounts of the digital games tax offset for an income year worked out under subsection (1) for:
(a) the company; and
(b) each other company (each of which is a related company ) that is *connected with or is an *affiliate of the company;
is greater than $20,000,000, the amount of the digital games tax offset for the company is:
(c) if the requirements of subsections (3) and (4) are satisfied - the amount specified in the notice given by the company under subsection (3); or
(d) otherwise - nil.
(3) The requirements of this subsection are:
(a) the company gives the Commissioner a notice in the *approved form specifying an amount that is not more than 30% of the sum of all the amounts determined by the *Arts Minister under section 378-25 that are specified in certificates issued to the company for the income year under section 378-30; and
(b) one or more of the related companies also give the Commissioner a notice in the approved form specifying an amount that is not more than 30% of the sum of all the amounts determined by the Arts Minister under section 378-25 that are specified in certificates issued to the related company for the income year under section 378-30; and
(c) the sum of all the amounts specified in the notices given by the company and those related companies does not exceed $20,000,000.
Example: Bilby Co is primarily responsible for developing a digital game. Wombat Co, a company connected with Bilby Co, is also primarily responsible for developing a digital game. The amount worked out under subsection (1) is $15,000,000 for the income year for each company. Since the sum of these amounts exceeds $20,000,000, the companies must coordinate with one another to ensure that the amount collectively claimed stays under the $20,000,000 cap. Bilby Co and Wombat Co agree that for the income year, they will each give the Commissioner a notice specifying $10,000,000 in notices. If they both do so, each will receive an offset of $10,000,000 for the income year.
(4) A notice given under subsection (3) by a company in relation to an income year must be given at the same time as the company claims the digital games *tax offset in its *income tax return for the income year.
(5) A company may vary the amount specified in a notice given under subsection (3) in relation to an income year if:
(a) in specifying the amount in the notice:
(i) the company made an inadvertent error in determining whether another company is a related company; and
(ii) as a result the company did not take account of the amount of the digital games tax offset for the other company for the income year; and
(b) the company gives the Commissioner a notice in the *approved form specifying the varied amount.
Otherwise, the notice is irrevocable.
378-20 Meaning of digital game
(1) A digital game is a game in electronic form that is capable of generating a display on:
(a) a portable electronic device; or
(b) a computer monitor, television screen, liquid crystal display or similar medium;
that allows for the playing of an interactive game.
(2) A component of a *digital game is taken to be a digital game if:
(a) a company that:
(i) is a foreign resident that does not have a *permanent establishment in Australia; and
(ii) owns or controls the rights to develop the digital game;
engages another company (the Australian developer ) to develop the component of the digital game; and
(b) the Australian developer:
(i) is an Australian resident that has an *ABN, or is a foreign resident that has a *permanent establishment in Australia and an ABN; and
(ii) is primarily responsible for undertaking activities necessary for the development of the digital game in Australia.
378-25 Arts Minister must issue certificate for the digital games tax offset
Completion certificate
(1) The *Arts Minister must issue a certificate (a completion certificate ) to a company for an income year in relation to a *digital game if:
(a) the game is *completed in the income year; and
(b) the company has made an application for a completion certificate in relation to the game; and
(c) the total of the company's *qualifying Australian development expenditure on the game incurred in completing the game is at least $500,000; and
(d) the Arts Minister is satisfied that the conditions in subsection (7) (about the type of game) are met for the game; and
(e) the Arts Minister is satisfied that the company:
(i) has developed the game as an original game; and
(ii) is primarily responsible for undertaking activities necessary for the development of the game in Australia.
Note: The operation of paragraph (e) is affected by paragraph 378-45(1)(d) (which deals with the situation where one company takes over the development of a digital game from another company).
(2) A *digital game is completed on the earlier of:
(a) when the game is first released to the general public (other than for testing purposes); or
(b) if the game is developed by a company under a contract entered into at *arm's length with another entity - when the company first provides a version of the game to the entity in a state where it could reasonably be regarded as ready to be released to the general public.
Porting certificate
(3) The *Arts Minister must issue a certificate (a porting certificate ) to a company for an income year in relation to a *digital game if:
(a) the game is *ported in the income year; and
(b) the company has made an application for a porting certificate in relation to the game; and
(c) the total of the company's *qualifying Australian development expenditure on the game incurred in porting the game is at least $500,000; and
(d) the Arts Minister is satisfied that the conditions in subsection (7) (about the type of game) are met for the game; and
(e) the Arts Minister is satisfied that the company:
(i) either owns or controls the rights to develop the game or has been engaged to develop the game by the entity who owns or controls the rights to develop the game; and
(ii) is primarily responsible for undertaking activities necessary for the development of the game in Australia.
Note: The operation of subparagraph (e)(ii) is affected by paragraph 378-45(1)(d) (which deals with the situation where one company takes over the development of a digital game from another company).
(4) A *digital game that has been *completed is ported on the earlier of:
(a) when the game is first made available to the general public (other than for testing purposes) on a new platform; or
(b) if the company developed the game under a contract entered into at *arm's length with another entity - when the company first provides a version of the game to the entity in a state where it could reasonably be regarded as ready to be made available to the general public on a new platform.
Ongoing development certificate
(5) The *Arts Minister must issue a certificate (an ongoing development certificate ) to a company for an income year in relation to one or more *digital games if:
(a) *ongoing development on the games occurs in the income year; and
(b) the company has made an application for the ongoing development certificate; and
(c) the total of the company's *qualifying Australian development expenditure on the games incurred in the income year on the ongoing development of the games in the income year is at least $500,000; and
(d) the Arts Minister is satisfied that the conditions in subsection (7) (about the type of game) are met for each of the games; and
(e) the Arts Minister is satisfied that the company:
(i) either owns or controls the rights to develop each of the games or has been engaged to develop the games by the entities who own or control the rights to develop the games; and
(ii) is primarily responsible for undertaking activities necessary for the development of each of the games in Australia.
Note: The operation of subparagraph (e)(ii) is affected by paragraph 378-45(1)(d) (which deals with the situation where one company takes over the development of a digital game from another company).
(6) Ongoing development on a *digital game means activities undertaken to update, improve or maintain the game after it has been *completed.
Type of digital game
(7) The conditions in this subsection that must be met for a *digital game are:
(a) the game is primarily developed to be made available to the general public for entertainment or educational purposes; and
(b) any of the following apply to the game:
(i) the game is made available for use over the internet;
(ii) the game is primarily played through the internet;
(iii) the game operates only when a player is connected to the internet; and
(c) the game is not any of the following:
(i) a game that is a gambling service (within the meaning of the Interactive Gambling Act 2001), or is substantially comprised of gambling or gambling-like practices;
(ii) a game that contains material likely to lead to the game being refused classification under the Classification (Publications, Films and Computer Games) Act 1995;
(iii) a game that is primarily developed for industrial, corporate or institutional purposes;
(iv) a game that is primarily developed to advertise or promote a product, entity or service.
Example 1: A slot machine simulator game would fail to satisfy the condition that the digital game must not be a gambling service or substantially comprise of gambling or gambling-like practices, even if the game did not involve any real money or money equivalent. However, an adventure game in which a player may advance to a higher level by winning a game of poker could still meet this condition.
Example 2: An interactive corporate training program would fail to satisfy the condition that the digital game must not be primarily developed for corporate purposes.
378-30 Arts Minister to determine a company's qualifying Australian development expenditure for the digital games tax offset
(1) The *Arts Minister must, as soon as practicable after deciding to issue a certificate under section 378-25 to a company, determine for the purposes of the digital games tax offset:
(a) if the certificate is to be issued under subsection 378-25(1) (completion certificate) to the company for an income year in relation to a *digital game - the total of the company's *qualifying Australian development expenditure on the game incurred in *completing the game, whether incurred in that income year or in an earlier income year; or
(b) if the certificate is to be issued under subsection 378-25(3) (porting certificate) to the company for an income year in relation to a digital game - the total of the company's qualifying Australian development expenditure on the game incurred in *porting the game, whether incurred in that income year or in an earlier income year; or
(c) if the certificate is to be issued under subsection 378-25(5) (ongoing development certificate) to the company for an income year in relation to one or more digital games - the total of the company's qualifying Australian development expenditure on the games incurred in the income year on the *ongoing development of the games in the income year.
(2) The determination must be in writing, but is not a legislative instrument.
(3) In making the determination, the *Arts Minister must have regard to the matters in Subdivision 378-B.
(4) The *Arts Minister must give the company written notice of the determination (including reasons for the determination).
Subdivision 378-B - Qualifying Australian development expenditure
Table of sections
378-35 Development expenditure
378-40 Qualifying Australian development expenditure
378-45 Expenditure incurred by prior companies in completing or porting a digital game
378-50 Expenditure to be worked out excluding GST
378-35 Development expenditure
(1) A company's development expenditure on a *digital game is expenditure that the company incurs in, or in relation to, the development of the game.
Specific inclusions
(2) Without limiting subsection (1), the following expenditure of the company in relation to the *digital game is development expenditure on the game:
(a) remuneration provided to persons (including independent contractors but excluding persons of a kind referred to in subsection (5)) who perform work or services directly for the company that are attributable to the development of the game, including the following:
(i) project managers and artistic, creative and design directors;
(ii) game designers;
(iii) software developers and programmers;
(iv) engineers (including for audio, graphics, physics and software);
(v) user experience designers and testers;
(vi) behaviour analysts;
(vii) quality assurance testers;
(viii) writers;
(ix) artists, animators and performers (for music, voice and motion capture);
(x) songwriters, composers, musicians and sound designers;
(xi) persons performing roles that are broadly similar to those described in subparagraphs (i) to (x);
(b) expenditure on research for the game;
(c) expenditure on prototyping for the game;
(d) expenditure on underlying game infrastructure (for example, game engines and anti-cheating controls);
(e) expenditure on user testing, debugging and collecting user data for the game;
(f) expenditure on updating the game;
(g) expenditure on obtaining or maintaining a classification under the Classification (Publications, Films and Computer Games) Act 1995;
(h) expenditure on adapting the game for use on particular platforms.
Specific exclusions
(3) Despite subsections (1) and (2), the following expenditure of the company in relation to the *digital game is not development expenditure on the game:
(a) the company's general business overheads including, for example:
(i) expenditure incurred in relation to insurance, audit services, accounting services, human resources, recruitment services and legal services; and
(ii) expenditure on travel, accommodation, catering, entertaining or hospitality; and
(iii) expenditure on visas or work permits; and
(iv) expenditure incurred by way of, or in relation to, the financing of the game or company;
(b) expenditure on, or in connection with, the following persons:
(i) employees and independent contractors whose roles are not related to, or are incidental and not directly attributable to, the development of the game (including for example, administrative employees, social media managers, sales and marketing professionals, community managers and forum administrators and moderators);
(ii) employees and independent contractors who were not Australian residents at the time the expenditure was incurred;
(c) expenditure on the use of land or premises;
(d) expenditure on computer hardware or servers, or the rights to access computer hardware or servers;
(e) expenditure on acquiring or licensing software;
(f) expenditure on marketing, advertising, publicity or promotion for the game or company;
(g) expenditure on activities that are incidental to, but not directly attributable to, the development of the game (including, for example, expenditure on externally provided training, conferences, hiring equipment, release events and trade show demonstrations);
(h) expenditure incurred to acquire copyright or a trade mark, or a licence in relation to copyright or a trade mark (other than in relation to acquiring a licence for employees or contractors);
(i) expenditure on obtaining permission to use the image, likeness or name of a person or entity, or obtaining an endorsement by a person or entity;
(j) expenditure on distributing the game;
(k) expenditure on acquiring users for the game;
(l) any expenditure claimed for the purposes of another *tax offset, including for the purposes of section 355-100 (tax offsets for R&D);
(m) expenditure that gives rise to notional deductions for the purposes of section 355-205 (deductions for R&D expenditure);
(n) expenditure funded directly or indirectly by:
(i) a Commonwealth grant or subsidy to which Australian businesses are generally eligible; or
(ii) a State or Territory grant or subsidy to which Australian business in that State or Territory are generally eligible.
Expenditure incurred in relation to another entity
(4) Despite subsections (1) and (2), the following expenditure of the company in relation to the *digital game is not development expenditure on the game:
(a) expenditure on contracting another entity (the first contractor ) to perform work or services for the company where the first contractor contracts for another entity (the second contractor ) to perform the work or services and either:
(i) the second contractor is not a natural person (including an independent contractor); or
(ii) the second contractor contracts for another entity to perform the work or services;
(b) expenditure incurred in relation to an entity that is an *associate of the company, other than an associate of a kind referred to in subsection (5);
(c) 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.
Remuneration of influential employees
(5) If a natural person (an influential employee ):
(a) is an *associate of the company because of subparagraph 318(2)(d)(i) or (ii) of the Income Tax Assessment Act 1936; and
(b) performs work or services directly for the company that are attributable to the development of the *digital game in an income year;
then, despite subsection (1), only the first $65,000 of remuneration provided by the company to the influential employee for the income year is development expenditure on the digital game.
Note: A minor voting interest is not sufficient for a person to be an associate of the company.
Decline in value not development expenditure
(6) To avoid doubt, the decline in the value of a *depreciating asset is not development expenditure on a *digital game.
378-40 Qualifying Australian development expenditure
(1) A company's qualifying Australian development expenditure on a *digital game is the company's *development expenditure on the game to the extent to which the expenditure:
(a) satisfies subsection (2); and
(b) is incurred for, or is reasonably attributable to, goods and services provided or acquired in Australia.
The relevance test
(2) An item of a company's *development expenditure on a *digital game:
(a) if the item of expenditure is substantially attributable to developing the game - satisfies this subsection in full; and
(b) if the item of expenditure is not substantially attributable to developing the game - satisfies this subsection to the extent that the expenditure is attributable to developing the game.
Expenditure that does not qualify
(3) For the purposes of a *digital game in respect of which a company applies for a certificate under subsection 378-25(1) (completion certificate), an item of the company's *development expenditure on the game is not qualifying Australian development expenditure to the extent it is incurred after the earliest of the following:
(a) the day on which the game is *completed;
(b) the day on which the company applies for the certificate;
(c) the day on which the game has been available to the general public for the purposes of conducting testing for one year.
(4) For the purposes of a *digital game in respect of which a company applies for a certificate under subsection 378-25(3) (porting certificate), an item of the company's *development expenditure on the game is not qualifying Australian development expenditure to the extent it is incurred after the earlier of the following:
(a) the day on which the game is *ported;
(b) the day on which the company applies for the certificate.
(5) You cannot count the same expenditure as *qualifying Australian development expenditure for the purposes of more than one certificate under section 378-25.
Example: Expenditure on porting a digital game that is claimed as qualifying Australian development expenditure for the purposes of a certificate under subsection 378-25(3) (porting certificate) cannot be claimed for the purposes of a certificate under subsection 378-25(5) (ongoing development certificate).
378-45 Expenditure incurred by prior companies in completing or porting a digital game
Expenditure incurred by outgoing company attributed to incoming company
(1) For the purposes of this Division, if a company (the incoming company ) takes over the development of a *digital game from another company (the outgoing company ):
(a) expenditure incurred by the outgoing company in relation to *completing or *porting the game is taken to have been incurred by the incoming company; and
(b) for the purposes of determining the extent to which that expenditure is *qualifying Australian development expenditure of the incoming company, the incoming company is taken:
(i) to have been an Australian resident at any time when the outgoing company was an Australian resident; and
(ii) to have been a foreign resident at any time when the outgoing company was a foreign resident; and
(iii) to have had a *permanent establishment in Australia at any time when the outgoing company had a permanent establishment in Australia; and
(iv) to have had an *ABN at any time when the outgoing company had an ABN; and
(c) expenditure that the incoming company incurs in order to be able to take over the development of the game is to be disregarded for the purposes of this Division; and
(d) any activities carried out by the outgoing company in relation to the game are taken, for the purposes of paragraph 378-25(1)(e) and subparagraphs 378-25(3)(e)(ii) and (5)(e)(ii), to have been carried out by the incoming company in relation to the game.
Expenditure previously attributed to outgoing company attributed to incoming company
(2) For the purposes of subsection (1):
(a) expenditure incurred by the outgoing company in relation to *completing or *porting the *digital game includes expenditure that the outgoing company is itself taken to have incurred on the digital game because of the operation of subsection (1) or a previous operation of that subsection; and
(b) the outgoing company is taken:
(i) to have been an Australian resident at any time when the outgoing company is taken to have been an Australian resident because of the operation of subsection (1) or a previous operation of that subsection; and
(ii) to have been a foreign resident at any time when the outgoing company was a foreign resident because of the operation of subsection (1) or a previous operation of that subsection; and
(iii) to have had a *permanent establishment in Australia at any time when the outgoing company is taken to have had a permanent establishment in Australia because of the operation of subsection (1) or a previous operation of that subsection; and
(iv) to have had an *ABN at any time when the outgoing company is taken to have had an ABN because of the operation of subsection (1) or a previous operation of that subsection; and
(c) activities carried out by the outgoing company in relation to the digital game include activities that the outgoing company is taken to have carried out in relation to the digital game because of the operation of subsection (1) or a previous operation of that subsection.
Example: If Uncle Carty Ltd starts out developing a digital game and then Mr Grouble Ltd takes over the development of the digital game, Mr Grouble Ltd is taken to have incurred the expenditure that Uncle Carty Ltd incurred on the digital game. If Lousie Ltd subsequently takes over the development of the digital game from Mr Grouble Ltd, Lousie Ltd is taken to have incurred the expenditure that Mr Grouble Ltd incurred on the digital game (including the expenditure of Uncle Carty Ltd that is attributed to Mr Grouble Ltd).
378-50 Expenditure to be worked out excluding GST
In determining an amount of expenditure for the purpose of this Division, the expenditure is taken to exclude *GST.
Subdivision 378-C - Certificates for digital games tax offset
Table of sections
378-55 Single company or head company may apply for certificate
378-60 Notice of refusal to issue certificate
378-65 Issue of certificate
378-70 Revocation of certificate
378-75 Amendment of certificate
378-80 Amendment of assessments
378-55 Single company or head company may apply for certificate
(1) A company or, if the company is a *member of a *consolidated group or a *MEC group, the *head company of the consolidated group or MEC group may:
(a) if all the company's *qualifying Australian development expenditure on a *digital game has been incurred in *completing the game - apply to the *Arts Minister for the issue of a certificate under subsection 378-25(1) (completion certificate) in relation to the game; or
(b) if all the company's qualifying Australian development expenditure on a digital game has been incurred in *porting the game - apply to the Arts Minister for the issue of a certificate under subsection 378-25(3) (porting certificate) in relation to the game; or
(c) if all the company's qualifying Australian development expenditure on a digital game or games has been incurred in an income year on the *ongoing development of the games in the income year - apply to the Arts Minister for the issue of a certificate under subsection 378-25(5) (ongoing development certificate) in relation to the games for the income year.
(2) The application must:
(a) specify which certificate is sought; and
(b) specify the company's *ABN; and
(c) specify whether the company is an Australian resident or a foreign resident with a *permanent establishment in Australia; and
(d) contain sufficient detail to enable the *Arts Minister to determine whether an item of expenditure incurred by the company is *qualifying Australian development expenditure on the game or on the games in the income year; and
(e) be made in accordance with the rules made under section 378-100 by the Arts Minister, so far as they relate to the requirements for applications.
378-60 Notice of refusal to issue certificate
If:
(a) an application is made under subsection 378-55(1) for the issue of a certificate; and
(b) the *Arts Minister decides under section 378-25 not to issue the certificate;
the Arts Minister must give the applicant written notice of the decision (including reasons for the decision).
378-65 Issue of certificate
(1) A certificate issued to a company under section 378-25 must:
(a) be in writing; and
(b) specify the company's *ABN; and
(c) specify the date of issue of the certificate; and
(d) specify the total of the company's *qualifying Australian development expenditure on the relevant *digital game or games, as determined by the *Arts Minister under section 378-30; and
(e) if the certificate is issued under subsection 378-25(1) (completion certificate) or (3) (porting certificate) - specify:
(i) the name of the digital game to which the certificate relates; and
(ii) the income year in which the digital game was *completed or *ported (as applicable); and
(f) if the certificate is issued under subsection 378-25(5) (ongoing development certificate) - specify:
(i) the name of the digital game, or digital games, to which the certificate relates; and
(ii) the income year for which the digital games tax offset is being sought.
(2) The *Arts Minister must give the Commissioner notice of the issue of the certificate within 30 days after issuing the certificate.
(3) The notice under subsection (2) must specify:
(a) the company's name; and
(b) the company's address; and
(c) the amount specified under paragraph (1)(d) in the certificate; and
(d) other matters agreed to between the Arts Minister and the Commissioner.
378-70 Revocation of certificate
(1) The *Arts Minister may revoke a certificate issued under section 378-25 if the Arts Minister is satisfied that:
(a) the issue of the certificate was based on inaccurate information; or
(b) the certificate was obtained by fraud or serious misrepresentation; or
(c) if the certificate is issued under subsection 378-25(1) (completion certificate) to a company for an income year in relation to a *digital game - the total of the company's *qualifying Australian development expenditure on the game incurred in *completing the game is less than $500,000; or
(d) if the certificate is issued under subsection 378-25(3) (porting certificate) to a company for an income year in relation to a digital game - the total of the company's qualifying Australian development expenditure on the game incurred in *porting the game is less than $500,000; or
(e) if the certificate is issued under subsection 378-25(5) (ongoing development certificate) to a company for an income year in relation to one or more digital games - the total of the company's qualifying Australian development expenditure on the games incurred in the income year on the *ongoing development of the games in the income year is less than $500,000.
(2) If the *Arts Minister revokes a certificate under subsection (1), the Arts Minister must, within 30 days after the date of revocation, give written notice of the revocation to:
(a) the company to whom the certificate was issued, including reasons for the decision to revoke the certificate; and
(b) the Commissioner.
(3) If a certificate is revoked under subsection (1), it is taken, for the purposes of this Division, never to have been issued.
Note: This means that if an assessment of a company's income tax is issued on the basis that the company is entitled to the digital games tax offset and a certificate on which the entitlement is based is then revoked, the assessment will be amended to take account of the fact that the company was never entitled to the offset or was entitled to the offset to a lesser amount: see section 378-80.
(4) Subsection (3) does not apply for the purposes of:
(a) the operation of this section or section 378-85; or
(b) a review by a court or the *AAT of the decision to revoke the certificate.
378-75 Amendment of certificate
(1) The *Arts Minister may amend a certificate issued under section 378-25 at any time during the period of 4 years starting immediately after the certificate is issued if:
(a) the company to whom the certificate is issued requests, in writing, an amendment to the certificate; or
(b) the Arts Minister decides to amend the certificate on the Arts Minister's own initiative.
(2) In deciding whether to amend a certificate under subsection (1), the *Arts Minister:
(a) must have regard to the matters prescribed by the regulations; and
(b) may have regard to any other matter that the Arts Minister considers relevant.
(3) If the *Arts Minister amends a certificate under subsection (1), the Arts Minister must, within 30 days after the date of amendment, give written notice of the amendment (including reasons for the decision) to:
(a) the company to whom the certificate was issued; and
(b) the Commissioner.
(4) If the *Arts Minister refuses to amend a certificate upon a request by a company under paragraph (1)(a), the Arts Minister must give the company written notice of the decision (including reasons for the decision).
378-80 Amendment of assessments
Section 170 of the Income Tax Assessment Act 1936 does not prevent the amendment of an assessment given to a company for the purposes of giving effect to this Division for an income year if:
(a) after the Commissioner gave notice of the assessment to the company, a certificate issued under section 378-25 of this Act to the company is either:
(i) amended under section 378-75 of this Act; or
(ii) revoked under section 378-70 of this Act; and
(b) the amendment of the assessment is made at any time during the period of 4 years starting immediately after the amendment or revocation of the certificate.
Note: Section 170 of the Income Tax Assessment Act 1936 specifies the periods within which assessments may be amended.
Subdivision 378-D - Review and other matters
Table of sections
378-85 Notice of decision or determination
378-90 Review of decisions by the Administrative Appeals Tribunal
378-95 Copy of digital game to be made available to the National Film and Sound Archive of Australia
378-100 Arts Minister may make rules about the digital games tax offset
378-105 Arts Minister may make rules establishing a Digital Games Tax Offset Advisory Board
378-110 Delegation by Arts Minister
378-115 Review of operation of this Division
378-85 Notice of decision or determination
(1) This section applies to:
(a) a notice given under section 378-60 (refusal to issue a certificate); and
(b) a notice of a determination given under section 378-30 (determination of qualifying Australian development expenditure); and
(c) a notice given under section 378-70 (revocation of a certificate); and
(d) a notice given under section 378-75 (amendment or refusal to amend a certificate).
(2) The notice of the decision or determination is to include the statements set out in subsections (3) and (4).
(3) There must be a statement to the effect that, subject to the Administrative Appeals Tribunal Act 1975, an application may be made to the *AAT, by (or on behalf of) any entity whose interests are affected by the decision or determination, for review of the decision or determination.
(4) There must also be a statement to the effect that a request may be made under section 28 of the Administrative Appeals Tribunal Act 1975 by (or on behalf of) such an entity for a statement:
(a) setting out the findings on material questions of fact; and
(b) referring to the evidence or other material on which those findings were based; and
(c) giving the reasons for the decision or determination;
except where subsection 28(4) of that Act applies.
(5) If the *Arts Minister fails to comply with subsection (3) or (4), that failure does not affect the validity of the decision or determination.
378-90 Review of decisions by the Administrative Appeals Tribunal
Applications may be made to the *AAT for review of:
(a) a decision made by the *Arts Minister under section 378-25 to refuse an application for a certificate; or
(b) a determination made by the Arts Minister under section 378-30 (total of a company's *qualifying Australian development expenditure); or
(c) a decision made by the Arts Minister under section 378-70 to revoke a certificate; or
(d) a decision made by the Arts Minister under section 378-75 to amend or refuse to amend a certificate.
378-95 Copy of digital game to be made available to the National Film and Sound Archive of Australia
The company to whom a certificate is issued under section 378-25 must make available to the National Film and Sound Archive of Australia:
(a) a copy of each *digital game named in the certificate; and
(b) a copy of any materials provided to the general public in connection with each of those games.
378-100 Arts Minister may make rules about the digital games tax offset
The *Arts Minister may, by legislative instrument, make rules:
(a) specifying how applications for certificates in relation to the digital games tax offset are to be made, including:
(i) the form in which applications are to be made; and
(ii) the information to be provided in applications; and
(iii) methods for verifying such information; and
(iv) procedures for providing, at the Arts Minister's request, additional information in support of an application; and
(b) specifying the form and contents of certificates in relation to the digital games tax offset; and
(c) specifying how amendments of certificates in relation to the digital games tax offset are to be made, including:
(i) the form in which the request for an amendment may be made; and
(ii) circumstances in which an amendment may be requested, or made on the Arts Minister's own initiative; and
(iii) the information to be provided in a request for an amendment; and
(iv) methods for verifying such information; and
(v) procedures for providing, at the Arts Minister's request, additional information in support of a request for an amendment; and
(d) providing for provisional certificates (including in relation to a matter referred to in paragraph (a), (b) or (c)).
378-105 Arts Minister may make rules establishing a Digital Games Tax Offset Advisory Board
The *Arts Minister may, by legislative instrument, make rules:
(a) establishing a Digital Games Tax Offset Advisory Board to:
(i) consider applications under subsection 378-55(1) for certificates under section 378-25; and
(ii) advise the Arts Minister on whether to issue certificates under section 378-25; and
(iii) perform other functions in relation to the operation of this Division (including the operation of rules made under section 378-100) as are specified in rules made under this section; and
(b) specifying the membership of the Board and the terms and conditions of appointment to the Board; and
(c) specifying procedures to be followed by the Board in performing its functions.
378-110 Delegation by Arts Minister
(1) The *Arts Minister may, in writing, delegate all or any of the Arts Minister's powers under this Division, other than under section 378-100 or section 378-105, to:
(a) the *Arts Secretary; or
(b) an SES employee, or acting SES employee, in the Department administered by the Arts Minister.
(2) In exercising powers under a delegation, the delegate must comply with any directions of the *Arts Minister.
378-115 Review of operation of this Division
(1) The *Arts Minister must cause a review of the operation of this Division to be undertaken as soon as possible after the end of 5 years after the commencement of this Division.
(2) The review must include:
(a) the effectiveness of this Division in supporting the growth of the digital games industry in Australia; and
(b) the fiscal sustainability of the concessional tax treatment provided by this Division.
(3) A written report of the review must be given to the *Arts Minister. The report must not include information that is commercially sensitive.
(4) The *Arts Minister must cause a copy of the report of the review to be tabled in each House of the Parliament within 15 sitting days of that House after the report is given to the Arts Minister.