SR&ED cash for private companies

R&D Tax Credit

Startups will receive Government of Canada cheques. Most are mystified by the academic prism that Canada Revenue Agency (CRA) uses to determine eligibility. All are intimidated by the paperwork CRA requires.

Scientific Research and Experimental Development (SR&ED) will improve your balance sheet. It is the Canadian government's largest incentive to encourage technology-based companies to perform research and development in Canada. They receive a total of ~$4 billion annually: $3 billion from the federal government plus $1 billion from provincial governments.

Canadian Controlled Private Corporations receive:

  • 68.5% of qualifying salaries;
  • 41.5% of contractor fees and costs of materials used to develop prototypes;
  • 22.6% of test equipment.

These percentages will decline slightly due to changes in the 2012 Federal Budget.

Your SR&ED cheque will decrease by 41.5% of IRAP grants of other government financial assistance that your company receives.

You must submit your SR&ED claims within 18 months after the end of every fiscal period. If two of your company's fiscal periods ended within the past 18 months you can submit two SR&ED claims! You'll receive a government cheque for both fiscal periods at the same time!!!

Government of Canada cheques usually arrive within ~4 months. Do not submit your T2 without SR&ED documentation, because that will delay your cheque. CRA intentionally delays SR&ED cheques attached to amended T2s, because CRA doesn't want to use its scarce resources twice.

Public, and foreign, companies receive only ~one-half the amount of SR&ED cheques that CCPCs receive, and in the form of tax credits which are valuable only when your company becomes profitable. , These "non-refundable" ITCs apply only to income taxes owing. When a CCPC goes public, it can submit its SR&ED claim for its "stub" fiscal period that ended the day before it becomes public.

My templates make SR&ED simple, and efficient. They can become an essential component of your cash flow planning.

R&D Tax Credit

SR ED Consultant

Richard Moore

Electrical Engineer, MBA

Former CRA Reviewer
tel. 604-331-4688

SR ED Consultant

Violeta Zohar Fiszbaum

Chemical Engineer

Technology Incentives Inc.
4639 West 3rd Ave.
Vancouver, B.C.
V6R 1N5
R&D Tax Credit