Interactive digital media tax credit

The interactive digital media tax credit (IDMTC) is for eligible registered corporations that develop interactive digital media products.

Budget 2023 extended the credit by five years. The credit applies to digital media products developed after August 31, 2010 and before September 1, 2028. 

Your corporation must register with the Ministry of Finance and pay the application fee for each tax year it wants to claim the IDMTC.

The credit is calculated as 17.5% of eligible salary and wages incurred in the tax year.

What is an interactive digital media product?

An interactive digital media product (IDM product) is designed to be used interactively by an individual and:

  • Consists of a combination of application files and data files, in a digital format, that are integrated and are intended to be operated together,
  • Is designed primarily to educate, inform or entertain the user,
  • Is capable of presenting information in at least two of the following forms:
    • Text
    • Sound
    • Images
  • Is intended to be used interactively by individuals, and
  • Is developed in British Columbia

but does not include a prescribed product.

Some examples of IDM products are:

  • Video games
  • Educational software
  • Edutainment products
  • Simulators

For the purpose of the IDMTC, products that are not intended to be used interactively are not IDM products. This includes:

  • Blogs
  • Online magazines or newspapers
  • Slide shows
  • Videos or PowerPoint presentations
  • Video streaming applications
  • Social media products

Augmented reality and virtual reality products

IDM products can also include augmented reality (AR) and virtual reality (VR) products if they meet IDM product requirements.

Below are specific examples of AR/VR products. The examples are for illustration only and do not indicate the eligibility of a particular proposed AR/VR product or industry. Each proposed product is subject to review and assessment to determine eligibility.

Examples of AR/VR products


The user is able to adjust parts of a vehicle’s shape and design to see how this affects aspects of vehicle performance. Ultimately the user selects the most efficient design to minimize air friction and optimize vehicle performance.

Product characteristics

Feedback: Based on the changes made by the user, the software will implement the resulting changes to the design and simulate the aerodynamics of the vehicle. The aerodynamics of the altered vehicle are then displayed to the user wearing the AR headset.

Control: The user wears an AR headset to virtually change the vehicle’s design shape by using a series of hand and voice commands.

Adaptation: Based on the feedback of the software, the user may consider making additional changes to get closer to the desired goals of performance thresholds. The product adapts the visual information relative to the position and location of the user to provide visual feedback of resulting air flow over the vehicle. It may even suggest shapes to reduce this drag.


This product is an eligible AR/VR product.

The user is able to walk around the entire real and virtual parts of the vehicle to gain a visual sense of the resulting air flow and vehicle performance from all angles. Based on the ongoing interaction with the AR product, the user can use the results displayed by the product to further refine design inputs in order to achieve the most streamlined design from an aerodynamics perspective. The user will have an experience that is different than the experience of other users.


An AR dinosaur exhibit for a museum allows a user to progress through the exhibit. As the user approaches designated spots, AR dinosaur images are displayed along with relevant information about the dinosaur.

Product characteristics

Feedback: The response of the computer software to the user is limited to displaying predetermined AR images as the user reaches fixed points in the exhibit. The image may change from different vantage points but is otherwise fixed AR content for the user to observe. The user doesn’t accumulate points for progressing through the AR dinosaur exhibit or for achieving any goals.

Control: The user has the ability to approach each designated spot to prompt the AR image to be seen. Control options for the user of this product are limited to moving forward or back within the exhibit.

Adaptation: The user’s experience is limited to viewing the AR dinosaur exhibit from a designated spot. Adaptation would require the user to be able to affect, through the user’s movements, the actions of the AR dinosaur exhibit.


This is not an eligible AR/VR product.

The AR experience is the same for each user and is lacking back and forth communication between the user and the computer software. The AR dinosaur exhibit is not “used interactively” as the user is an observer or spectator rather than a participant. The user is not able to have a unique experience and make changes to the information displayed.


Claiming the credit

Claim the credit with the Canada Revenue Agency no later than 18 months after the end of the tax year in which the eligible salaries and wages are incurred. The credit is fully refundable, but it is first applied against total income tax payable. There are no carry-back or carry-forward provisions.

To submit a claim, complete Schedule 429, British Columbia Interactive Digital Media Tax Credit and then enter the amount of the credit on line 680 of Schedule 5, Tax Calculation Supplementary – Corporations. You'll need to submit both schedules with your T2 Corporation Income Tax Return.

Reconsiderations and appeals

If your corporation disagrees with a decision to refuse or cancel your registration, reconsiderations can be brought to the BC Commissioner of Income Tax.

An appeal has to be brought in the Supreme Court within 120 days after the date of any notice of that decision provided by the BC Commissioner of Income Tax.  


The following legislation applies to the interactive digital media tax credit program: