Are You Paying for Your R&D or Is Your R&D Paying You?


The Scientific Research and Experimental Developmen (SR&ED) Tax Incentive Program supports research and development (R&D) projects in Canada.

This lucrative tax incentive program is not limited to high technology companies, although most manufacturing and technology companies would qualify to at least some extent. Any company may have a project that would qualify for the SR&ED program, which could be anything from improving the capabilities of an existing device to developing a new tool or piece of equipment.  

There are some basic criteria that would qualify a project for the SR&ED program. In the case of experimental development, the purpose of the work must be to create new or improve existing materials, devices, products, or processes. Some examples may be creating specialized equipment to develop a certain product or improve production; developing a new tool, device, or piece of equipment; or creating or improving computer or mobile applications.

If your work involves research, the work must be done to advance scientific knowledge, with or without a specific practical application in view. Some examples may be research in the field of theoretical physics, with the goal of advancing scientific knowledge in general; or research in the medical field, with the goal of improving treatment or finding a cure for a certain disease or condition.

Your project does not necessarily have to be successful to qualify for SR&ED. Even a negative result can advance scientific knowledge.

Your SR&ED claim will provide you with a tax credit of approximately 60% of qualifying R&D expenses and is available to corporations, as well as proprietorships, partnerships, and trusts. Your SR&ED investment tax credit (ITC) can be used to reduce your income tax payable, if any. The remaining ITC can be refunded.

If you have done or are currently working on a project or research, you may qualify for the SR&ED Program, please contact us for more information. Let's get your R&D to pay you!