What it is designed to do
Australia runs three federal screen offsets. The producer offset supports Australian content. The PDV offset targets post, digital, and visual effects work at A$500,000 of QAPE and up. The Location Offset is aimed at the big international shoot that could as easily have gone to Georgia, the UK, or New Zealand. Its 30% rate and A$20 million film threshold are set for that market.
Money is claimed by a company that is an Australian resident or has a permanent establishment in Australia, usually a local production services company set up for the show. Like the other offsets, it is paid through that company's tax return after completion.
Arithmetic on a mid-size feature
A studio thriller budgets US$60M worldwide and plans to shoot and do some VFX in Queensland. The Australian service company tracks the local spend.
| Line | Amount |
|---|---|
| Total Australian spend | A$48,000,000 |
| Less non-qualifying items (for example some financing and non-Australian costs) | (A$6,000,000) |
| QAPE | A$42,000,000 |
| Clears the A$20M film threshold? | Yes |
| Offset at 30% | A$12,600,000 |
If the producer moved VFX to another country and QAPE fell to A$19,500,000, the project would miss the threshold and get nothing from this offset. Any Australian VFX work left on the show would then be assessed against the PDV Offset rules instead.
Things that trip up international producers
Currency is first. Finance plans are usually in US dollars, but QAPE and the threshold are in Australian dollars, so a shift in the exchange rate changes both the offset's US dollar value and how comfortably the project clears the threshold. Model it at a conservative rate.
The second is the one-offset rule. Productions sometimes plan Location Offset money for the shoot and PDV Offset money for VFX on the same project, but they need to choose one. The third is cash flow. The offset arrives after completion and audit, so the studio or a lender carries the money in the meantime, and state screen agency incentives often come with their own conditions and timing.
Where to compare
The Australia incentive page lists state incentives that can sit on top. For comparison with nearby markets see New Zealand, which runs a cash rebate, and the incentives hub. Model QAPE and currency scenarios in the incentive calculator.