Who it is for
The Producer Offset exists to support Australian stories. To qualify, a project needs an Australian production company, has to pass the Significant Australian Content (SAC) test or be an official co-production, and has to meet format rules such as minimum duration and QAPE thresholds. Screen Australia's Producer Offset and Co-production Unit administers it and issues the final certificate.
The SAC test is a judgment rather than a points table like the UK cultural test. It looks at the subject matter, where the project was made, and the nationality and residence of the people who made it.
The calculation on an A$3.5M feature
An Australian thriller budgeted at A$3,500,000 is made for cinema release. The accountant removes costs that don't count as QAPE, such as non-Australian post and some financing costs, and arrives at A$3,000,000.
| Line | Theatrical feature | Same project made for streaming |
|---|---|---|
| QAPE | A$3,000,000 | A$3,000,000 |
| Offset rate | 40% | 30% |
| Offset | A$1,200,000 | A$900,000 |
| Share of the A$3.5M budget | 34% | 26% |
The release plan is worth A$300,000 here. That difference is why producers lock the intended release before financing: a project that loses its theatrical path can fall back to the 30% rate.
How the money arrives
The offset is claimed through the production company's tax return after the project is complete and Screen Australia has issued the final certificate. As a refundable offset, it is paid out even when the company owes no tax. Since the cash comes at the end, producers cash-flow it during production. Many apply to Screen Australia for a provisional certificate early, which gives a lender more comfort, then borrow against the expected offset. On the example above, a loan against the A$1.2M offset, less interest, fees, and any holdback the lender requires, becomes part of the budget closing.
Common mistakes
Budgeting the offset on the full budget is the first. On this project that overstates it by A$200,000 (40% of the A$500,000 that isn't QAPE). Another is assuming every streaming or TV format gets 40%. The 40% rate applies to features produced for cinema exhibition. Producers also underestimate audit and legal costs and the months between delivery and certification, which add interest to the cash flow loan.
Related pages
The Australia incentive page covers state screen agency incentives that sit on top of the federal offset. Foreign productions should read the location offset and PDV offset entries, and shooting in Australia compares the options. Run the numbers in the incentive calculator.