and Revenue Administration
Corporate Tax Act
Special Notice Vol. 5 No. 51
||December 10, 2018
||Alberta Treasury Board and Finance, Tax and
|For more information:
5 No. 51 / December 2018
INTERACTIVE DIGITAL MEDIA TAX CREDIT
NOTE: This special notice is intended to explain legislation and provide specific information. Every effort has been made to ensure the contents are accurate. However, if a discrepancy should occur in interpretation between this special notice and governing legislation, the legislation takes precedence.
The Interactive Digital Media Tax Credit Act (IDMTC Act) was enacted as part of the Growth and Diversification Act, which received Royal Assent on June 11, 2018. The IDMTC Act established the Interactive Digital Media Tax Credit (IDMTC), a new refundable tax credit for corporations. Section 26.93 has been added to the Alberta Corporate Tax Act (the ACTA) in order to implement the IDMTC.
The application process for the IDMTC is administered by Alberta Economic Development and Trade (EDT), which will issue to eligible applicants certificates indicating the amount of the respective tax credit to which the corporation is entitled. The claiming of the IDMTC is administered by Alberta Treasury Board and Finance, Tax and Revenue Administration (TRA).
A corporation may deduct the IDMTC in a particular taxation year to a maximum of the amount shown on the respective IDMTC certificate issued by EDT and the respective Alberta corporate tax payable calculated before deducting the IDMTC. Because the IDMTC is “refundable”, the amount by which the corporation’s IDMTC exceeds the corporation’s tax otherwise payable under the ACTA for the year, net of any other Alberta tax, interest, penalties or other amount owing by the corporation to Alberta, will be paid to the corporation.
A corporation is not entitled to an IDMTC for a taxation year if the corporation claims an Alberta Scientific Research and Experimental Development (SR&ED) Tax Credit. Accordingly, a corporation otherwise eligible to claim an IDMTC and an SR&ED Tax Credit is responsible for determining which tax credit it prefers to claim for a particular taxation year.
The amount of IDMTC that a corporation may deduct from tax payable is reported on line 085 of the Alberta Corporate Income Tax Return (AT1). The AT1 is available on the Corporate Income Tax - Forms page of the Government of Alberta website. Claimants also will be required to report the number of the IDMTC certificate issued by the Minister of Economic Development and Trade on line 110 of the AT1. Accordingly, the IDMTC should not be claimed on the AT1 until the respective certificate has been issued. Claimants are not required to file the certificate along with the AT1, but claimants should be prepared to provide a copy of the certificate upon the request of TRA.
For additional information, please refer to the IDMTC program page on the Government of Alberta website.