Get Video Games Tax Relief in Ireland | Nathan Trust

Companies in the digital gaming industry now have an incentive to develop new games – up to 32% of qualifying costs can be claimed as a tax credit by companies annually, or upon completion of development. The Digital Gaming Tax Credit is subject European state aid approval before being enacted, providing an even bigger boost for those innovating within this sector.

In my many discussions with businesses setting up a company in Ireland over the years, many are attracted by tax credits like this one but most stay for access to talent. Ireland has a lot of video game talent. 

What type of video game qualifies?

Before diving into developing a digital game, companies first need to consider if their project meets the definition. Digital games are products of advanced technology and must include interactive software that allows users to engage with at least three out of audio, graphics, animation/video sequences or non-downloadable content.

1. Text
2. Sound
3. Still images
4. Animated images

Expenditure on the design, production, and testing of the digital game should be considered permissible for the purpose of this tax relief.

Necessary and appropriate

This beneficial scheme provides a tax credit of up to 32% on eligible expenditure, with an upper limit of €25 million per project and a minimum spend requirement set at €100,000.

It has been officially approved through the state aid rules in accordance with Article 107(3)(a) from the European Commission – demonstrating its compliance as “necessary” and “appropriate" for cultural development initiatives within video gaming realms across EU member states without causing any issues related to competition concerns.

Development of each game must be certified

Companies looking to benefit from the new tax credit must obtain certification. The Minister for Tourism, Culture, Arts, Gaeltacht Sport and Media will assess various aspects of the business before granting this certificate – such as:

• The proportion of the activity carried out in Ireland/EEA, as well as the proportion of Irish or EEA nationals/residents involved

• The Irish/European cultural relevance of the setting, characters, language, or storyline of the game

• The use of materials or music created in Ireland/Europe, including that created by an Irish/EEA national/resident

• The educational content of games intended for children, and the themes relating to diversity and equality

• The content of the game relates to the promotion of sustainability and minimisation of climate change.

Certification Types

There are 2 types of certification:

1. An interim certificate
   Issued to video game companies who are still in the process of developing their game.
2. A final certificate
   This is issued to video game companies who have completed the development of their game.

Information regarding the timeline of the application process for the cultural certificate from the Minister has yet to be confirmed.

Are you curious about the Digital Gaming Tax Credit or interested in learning how we can help your business? Get all of your questions answered quickly by reaching out to us via our form. We look forward to hearing from you!