Digital games tax credit comes into effect in Ireland


A digital games tax credit that seeks to boost the sector in Ireland was formally signed into legislation by Government on 21 November.

Announced as part of Budget 2022, the digital games tax credit is a refundable corporation tax credit available to video game development companies based and paying taxes in Ireland. It will be based on qualifying expenditure incurred on designing, producing and testing a digital game that promotes Irish or European culture in some form. Available at a rate of 32pc of eligible expenditure, the tax credit has a limit of €25m per project. There is also a minimum spending requirement of €100,000 for each project.

The scheme required approval from the European Commission under EU state aid rules and was assessed under the article that enables member states to grant aid to promote cultural and heritage conservation in the EU. The Commission found the scheme to be "necessary and appropriate" to promote the development of cultural and educational video games. The chair of the Revenue Commissioners will now sign the regulations, allowing digital games development companies to apply for an interim certificate from the Department Tourism, Culture, Arts, Gaeltacht, Sport and Media for a qualifying digital game. It is expected certificate holders will then be able to apply for remuneration under the credit from Revenue starting 1 January 2023.

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