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

What is SR&ED?

The Scientific Research and Experimental Development (SR&ED) program is a federal tax incentive program, administered by the Canada Revenue Agency (CRA) that encourages Canadian businesses of all sizes and in all sectors to conduct research and development (R&D) in Canada that will lead to new, improved, or technologically advanced products or processes. The SR&ED program is the largest single source of federal government support for industrial research and development.

The SR&ED program gives claimants cash refunds and/or tax credits for their expenditures on eligible R&D work done in Canada.

Claimants can apply for SR&ED investment tax credits for expenditures such as wages, materials, machinery, equipment, some overhead, and SR&ED contracts.

In order for a project to qualify for SR&ED tax credits, you must demonstrate that the project has:
  • Advanced the technological knowledge base of the company

  • Involved one or more technological obstacles to be resolved

  • Incorporated a systematic investigation by qualified personnel having relevant experience in science, technology, or engineering.
Not sure if you qualify? Click on the SR&ED Eligibility Self-Assessment Tool link at the bottom of this page to find out.

Categories of Work that qualifies for SR&ED tax credits includes:

  • Basic Research - Work undertaken to advance scientific knowledge without a specific practical application in view.

  • Applied Research - Work undertaken to advance scientific knowledge with a specific application in view.

  • Experimental Development - Work undertaken to achieve technological advances for the purpose of creating new, or improving existing, materials, devices, products or procesees, including incremental improvements.

  • Support Work - Work that directly supports and is commensurate with the needs of basic research, applied research, and experimental development in the following areas: engineering, design, operations research, mathematical analysis, computer programming, data collection, testing, and psychological research.

Benefits of the SR&ED Program

The SR&ED program is extremely generous. Through this program, you can earn a refundable tax credit of up to 82% of your R&D expenditures in the province of Québec.

At the federal level, a Canadian-controlled private corporation (CCPC) can earn an investment tax credit (ITC) of 35% up to the first $3 million of qualified expenditures for SR&ED carried out in Canada, and 20% on any excess amount. Other Canadian corporations, proprietorships, partnerships, and trusts can earn an ITC of 20% of qualified expenditures for SR&ED carried out in Canada.

Generally, a CCPC with a taxable income in the immediately preceding year that does not exceed the qualifying income limit  may receive a portion of the ITC earned as a refund, after applying these tax credits against taxes payable.

The ITC earned by a Canadian corporation that is not a CCPC is non-refundable, but may be used to reduce any taxes payable. The ITC earned by a proprietorship or certain trusts may be partially refunded after applying these tax credits against taxes payable.

At the Quebec level, SR&ED salaries and 50% of Quebec subcontracting payments qualify for a 17.5% refundable tax credit. Some qualifying Canadian Controlled Private Corporations (CCPC) can earn a 37.5% refundable tax credit.

There are also other substantial provincial refunds that we will claim for you depending on your location. The following provinces offer SR&ED tax incentives in addition to the federal SR&ED incentives: Newfoundland & Labrador, Nova Scotia, New Brunswick, Quebec, Ontario, Manitoba, Saskatchewan and British Columbia. 

Consult the links below to learn more about the SR&ED tax incentive program:

Scientific Research and Experimental Development (SR&ED) Tax Incentive Program

Provincial and Territorial Government R&D Programs

SR&ED Eligibility Self-Assessment Tool

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