Eligible R&D Activities in the Gaming & Software Industries

The Canadian software and gaming industries have been undergoing an evolutionary change with cloud computing, mobile computing, artificial intelligence (AI), virtual reality (VR), augmented reality (AR) and IT consumerisation; driving permanent shifts in the basic structure of the industries. These trends are forcing software and gaming vendors to substantially rethink the way they develop, price, sell, deliver and service products. A similar shift has been happening on in-house software projects. Here organisations are under pressure to get more value from IT by developing or integrating technologies for distributed architectures to run on the cloud, and by scaling their operational needs without additional outlay on expensive infrastructure.

Below are some general software and gaming activities that are eligible for the R&D Tax Credit.

General software-based R&D activities that may be eligible:

• Designing and developing greenfield applications;
• Enhancing applications and re-engineering (legacy);
• Integrating enterprise systems;
• Developing adaptive real-time search mechanisms for large-scale databases;
• Creating decision-making tools based on predictive and optimisation models;
• Consulting on technology and architecture;
• Development of a new operating systems;
• Developing new generic methods of capturing, transmitting, storing, retrieving or manipulating, searching or securing data;
• Development of software to run new types of computer hardware, particularly where there are conflicts between hardware and software;
• Development of new programming languages or software development tools or the development of significant extensions to an existing language;
• Development of new technologies for use in application software;
• Development of new software framework and/or architecture;

Areas in the Gaming Industry where R&D activities may be eligible:

• Algorithm design;
• Processing power, improving system performance, memory management;
• Image processing and reconstruction;
• Interoperability with third-party products;
• Simulation and motion capture;
• Concurrency;
• Development in AR and VR;
• Mobile or online gaming;

Expenditures can include wages, third-party contractor cost, materials, machinery, equipment, and overheads.

For a detailed evaluation of the gaming and software industries, please contact the professionals at Braithwaite today.