from Practical English Usage
by Michael Swan
This, that and it can all be used to refer back to things that have been talked or written about earlier. The differences between them are not well understood, but the following suggestions may be useful.
All three words can be used in the sense of "the thing or situation I have just mentioned."
It does not give any special emphasis to the thing or situation.
So she decided to paint her house pink.It upset the neighbours a bit.
This and that are more emphatic; they seem to suggest "an interesting new fact has been mentioned."
So she decided to paint her house pink.This/That really upset the neighbours, as you can imagine.
This seems to be preferred when the speaker has more to say about a new subject of discussion.
So she decided to paint her house pink.This upset the neighbours so much that they took her to court, believe it or not. The case came up last week . . .
Then in 1917 he met Andrew Lewis.This was a turning point in his career: the two men entered into a partnership which lasted until 1946, and . . . (More natural than "That was a turning point...")
When more than one thing has been mentioned, it generally refers to the main subject of discussion; this and that generally select the last thing mentioned. Compare:
We keep the ice-cream machine in the spare room. It is mainly used by the children, incidentally. (The machine is used by the children.)
We keep the ice-cream machine in the spare room. This/That is mainly used by the children, incidentally. (The spare room is used by the children.)
It is only used to refer to things which are "in focus"--which have already been talked about. This can be used to "bring things into focus" before anything has been said about them. Compare:
I enjoyed 'Vampires'Picnic'. It/This is a film for all the family...
Vampires' Picnic: This is a film for all the family . . . (NOT Vampires' Picnic: It is a film for all the family...)
Only this can refer forward to something that has not yet been mentioned.
Now what do you think about this? I thought I'd get a job in Spain for six months, and then. . . (NOT Now what do you think about that/it?)