---
title: Ontario Funding Landscape
collection: Ontario Hub
path: Ontario Hub/Ontario Funding Landscape
parentDocument: null
outlineId: e8c241c0-7c0f-45c8-919f-e4b3affc8c42
updatedAt: '2026-03-16T16:06:00.507Z'
createdBy: Jennie R.F.
---
- [ ] Explain ideas for experimental R&D


---

OIDMTC details, Ontario Creates funding programs, any provincial co-op incentives, GTA-specific resources. Feeds into Session 6 content.

## OIDMTC 40% labour credit

[Ontario Interactive Digital Media Tax Credit](https://ontariocreates.ca/tax-incentives/oidmtc) is an extremely valuable incentive for ON studios.

(Note: studios can claim 3 years from fiscal year end retroactively!!)

It provides:

* a refundable tax credit of 40% on eligible Ontario labour expenditures for studios that develop and self-publish their own games (weirdly called "non-specified products")
* up to $100,000 in marketing and distribution expenditures per product
* Fee-for-service work earns a 35% credit.

*There is no annual cap on eligible labour expenditures*

Administered through Ontario Creates (which issues a certificate of eligibility) and the CRA (which processes thje credit on the T2).

Studios must apply within 18 months of the tax year **in which a product was completed**

Administration fee is 0.15% of eligibile expenditures ($1,000-$10,000)

There are 4 streams, with different requirements.


1. Non-specified (own IP, self-published)

   
   1. 40%
   2. 80/25 rule; product must be completed; revenmue stream required.
2. Specified (fee-for-service)

   
   1. 35%
   2. 80/25 rule; arm's-length purchaser; product completed
3. Qualifying digital game corporation

   
   1. 35%
   2. Min $1M Ontario labour over 36 months; product need not be completed
4. Specialized digital game corporation

   
   1. Min $500K Ontario labour/year; 80%+ payroll or 90%+ revenue from games; annual filing

### The 80/25 rule

* 80% of total dev labour must be performed in Ontario
* 25% must be paid as wages to employees of the claiming corporation (**not contractors**)
  * This second requirement is particularly important for co-ops. Worker-members ***must be on payroll*** receiving T4 slips to count toward the 25% employee test. If a co-op treats its members primarily as independent contractors, it will likely fail this threshold.
* \

### Stacking OIDMTC

#### SR&ED

Studios can claim OIDMTC and SR&ED credits in the same year, but *cannot claim the **same** labour expenditures under both programs.*

Approach ideas:

* Allocate experimental R&D work\[^1\] to SR&ED and regular game dev work to OIDMTC

SR&ED provides a 35% refundable credit for CCPCs on the first $6 million in qualifyinf expenditures.

Studios should also claim the Ontario Innovation Tax Credit (OITC), which provides an additional 10% refundable credit on SR&ED expenditures in Ontario

Now includes capital expenditures - for equipment

SR&ED credits are not considered "government assistance" that would reduce OIDMTC eligible expenditures

#### NRC IRAP

NRC IRAP provides non-repayable grants for innovative R&D *projects* with clear milestones (vs sr&ed which is for broader annual activities). You must be able to cover 20% of wage costs and 50% of contractor costs.

You can claim IRAP on a subset of your work, then claim tax credits on everything

**Important:** Requires pre-approval before project start. Cannot be claimed retroactively. Not all work qualififies. It needs to be "innovative" risky R&D. You really need to build trust with your assigned Industrial Technology Advisor.

#### Canada Media Fund

Experimental Stream:

* Development funding: Up to $15,000
* Production funding: Up to $250,000
* Marketing funding: Up to $30,000

Approach:


1. Use CMF for production costs (voice acting, music licensing, marketing, equipment rental)
2. Use OIDMTC/SR&ED for internal labour costs

##### Eligibility

* Canadian ownership, control, and key personnel
* Innovative and experimental
* Cultural or educational value
* Public distribution – requires digital distributor
* Provide very detailed project plan and budget

#### Provincial grants

##### Ontario Creates

* Interactive Digital Media Fund (IDM Fund): Up to $250,000 for development/production
* Market Development Programs: Travel, marketing, partnership support


\
##### Ontario Arts Council


#### Toronto Arts Council

#### Youth employment programs


### Eligibility

* For-profit cooperative corporations can likely claim it.
  * legislation requires only "Canadian corporation" status without specifying incorporation type, ***though co-ops must ensure for-profit structure, employee treatment of worker-members (for the 25% employee test), and should seek professional confirmation given no explicit co-op guidance exists in the program.***

## Functional cooperative legal framework

* federal patronage dividend deductions

## Dense GTA support ecosystem

* Ontario Creates funding up to $300K
* But EVERYTHING designed with standard corporations in mind
  * Coops are not *excluded,* but they are never explicitly addressed. This creates ambiguity that studios need to resolve with program admins and tax/accountants.
* \


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## What (Ontario) coops should do

* Coops should incorporate as *for-profit* under CCA if they want to take advantage of any of these opportunities.
* Track EVERY expense carefully from the first day of development - start nOW!!
* Put workers on payroll – must be *employees* not contractors to claim credits
* Join the OCA and CWCF for development support and the Tenacity Works loan fund
* Do Futures Forward training to unlock Ontario Creates (IF less than 3 years in IDM)
* Begin claiming OIDMTC from the first eligible tax year
* Carefully separate SR&ED-eligible experimental work
* Get in touch with program admins at OC EARLYT to confirm eligibility before applying
* \

\[^1\]: Work must address technological uncertainty through systematic investigation