Reflections on IO Launch series about OIDMTC
Sometimes when topic is of a particular interest I do visit launches in Gladstone Hotel organized by Interacative Ontario. I find their events very informative and in some way motivational as you get people in the room that have similar vision to yours.
This past Friday the topic was Ontario Interactive Digital Media Tax Credit (OIDMTC) . OIDMTC is a refundable tax credit based upon the eligible Ontario expenditures claimed by Canadian corporation for an interactive digital media products.
These are my notes from the discussion:
-bigger portion of the discussion was centered on SR&ED vs. OIDMTC . Conclusion: SR&ED is better since you can apply for it year long and you don’t have to have a successful product in a time of application. However, if you are in doubt either your company is eligible for SR&ED you can apply for both programs and government will choose which is the most appropriate program for you. You can’t stack two of these credits.
-OIDMTC is a labour credit. Some nuances might arise when you sub-contract work to other companies. If you do plan to claim this credit make sure you meet with an accounting firm that has an expertise in this field to make sure you stay in requirements of the credit.
-it is a good idea to hire an accounting company to fill out the application for you as it can be very difficulat to do it for a person. Most of the accounting companies work on contingency basis (10%-25%) depending on a difficulty of an application
-when you do use outside company make sure you still understand the process of the claim and what is submitted to the government. When they come with an audit you want to be able to showcase that you do what you claimed you do in your application.
-some of the other funds used for financing are Telefilm Canada New Media Fund and Bell New Media Fund
-you have up to 4 years to claim OIDMTC and if you constantly update your product (for example website platform update) you can only apply once in two years. From what I understood you have to apply by the end of your fiscal year.
-two deadlines May 11th and October
Overall it seemed like that if you are eligible it is actually humanely possible to receive this credit and people in OMDC are actually pretty nice and answer phone calls. Being a new entrepreneur during recession times there are so many things I have to take care of and sometimes it is hard to pay attention to everything. However, optimizing you company and getting financed through governemnt should never go off your radar as cashflow and investment is a bloodline for a start-up business.
I will post in the future my experiences with applyijg for different tax credits.
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