Scientific Research & Experimental Development Tax Credit (SR&ED)

Do You Qualify for a Grant?

Amount: Up to $6,000,000 (updated from$3,000,000)

The Scientific Research & Experimental Development Tax Credit (SR&ED) Program is a federal tax incentive program designed to encourage Canadian businesses of all sizes and from all sectors to conduct R&D in Canada. These incentives may be claimed by Canadian-controlled private corporations at the enhanced rate of 35% (increased from $3 million to $6 million) on qualified (SR&ED) expenditures. Other corporations, as well as individuals and trusts, can also reap the benefits.

Deadline for Applications: 18 months following your corporation’s fiscal year-end

Eligibility Criteria: Scientific Research & Experimental Development Tax Credit (SR&ED)

Must be Canadian Controlled Corporation or Partnership;
Must conduct scientific research and experimental development, i.e. systematic investigation or search that is carried out in a field of science or technology by means of experiment or analysis and that is:
- basic research, namely work undertaken for the advancement of scientific knowledge without a specific practical application in view;
- applied research, namely work undertaken for the advancement of scientific knowledge with a specific practical application in view; or
- experimental development, namely, work undertaken for the purpose of achieving technological advancement for the purpose of creating new, or improving existing, materials, devices, products or processes, including incremental improvements thereto; and, in applying this definition in respect of a taxpayer, includes:
- work undertaken by or on behalf of the taxpayer with respect to engineering, design, operations research, mathematical analysis, computer programming, data collection, testing or psychological research, where the work is commensurate with the needs, and directly in support, of work described in paragraph (a), (b), or (c) that is undertaken in Canada by or on behalf of the taxpayer, but does not include work with respect to
market research or sales promotion;
quality control or routine testing of materials, devices, products or processes;
research in the social sciences or the humanities;
prospecting, exploring or drilling for, or producing, minerals, petroleum or natural gas;
the commercial production of a new or improved material, device or product or the commercial use of a new or improved process;
style changes; or
routine data collection.

Eligible Cost: Scientific Research & Experimental Development Tax Credit (SR&ED)

Cost of R&D that meets definition above
Labour cost
Subcontractors cost
Materials cost

Our Focus

File income tax return along with SR&ED Expenditures Claim Form.
File Investment Tax Credit Form
Submit technical and financial supporting evidence (various records, photographs, videos, prototypes eg.) if required

Examples of the Projects Approved by Scientific Research & Experimental Development Tax Credit (SR&ED)

Every year, the Canada Revenue Agency approves billions of dollars worth of Scientific Research & Experimental Development Tax Credit (SR&ED) claims. Stay tuned for the upcoming updates of the program by completing the form at the top.

Success story: Rho-Can Machine and Tool Company

Founded in 1983, Rho-Can Machine and Tool Company offers specialized machine-shop services and manufacturing solutions, catering to the military, automotive, and aerospace sectors. The company focuses on designing and constructing custom-purpose machines and equipment.

The Scientific Research and Experimental Development (SR&ED) Tax Incentives Program has significantly supported Rho-Can in expanding its business. When discussing the impact of the SR&ED program on their research and development efforts, Rho-Can stated:

“I can honestly tell you that the SR&ED Program has helped Rho-Can immensely. It has given us the courage over the years to tackle projects that we would otherwise have considered as being outside of our comfort zone. Those same projects that we tackled a few years ago, have now become mainstay products for Rho-Can.”

Success story: cStar Technologies Inc.

Located in Richmond Hill, Ontario, cStar Technologies Inc. specializes in two-way wireless data communication solutions for various applications, including machine-to-machine, machine-to-mobile, machine-to-human, and mobile-commerce. The company’s research and development (R&D) efforts have enhanced Canada’s global technological competitiveness.

The Scientific Research and Experimental Development (SR&ED) Program’s tax incentives for qualified expenditures have enabled cStar to conduct a series of experiments, leading to the development of wireless communication solutions for their clients. These innovations have resulted in both domestic and international patents and have contributed to the creation of quality jobs in Canada. Stella Yoon, President and CEO, praised the SR&ED Program for its support:

“Innovation flourishes in a free environment, and this program has afforded us the flexibility we need to grow. The financial support has reduced the cost and risk of innovating and has allowed us to experiment more freely. We also received great customer service. The staff were professional, efficient, and thoughtful, which matches our experience with the program overall.”

Scientific Research & Experimental Development Tax Credit (SR&ED)

Do You Qualify for a Grant?

Amount: Up to $6,000,000 (updated from$3,000,000)

Deadline for Applications: 18 months following your corporation’s fiscal year-end

Eligibility Criteria: Scientific Research & Experimental Development Tax Credit (SR&ED)

Eligible Cost: Scientific Research & Experimental Development Tax Credit (SR&ED)

Our Focus

Success story: Rho-Can Machine and Tool Company

Success story: cStar Technologies Inc.

Do You Qualify for a Grant?

Ready to Order?