You might be surprised by what is eligible for SR&ED tax incentives. Innovation incentives are not just for people who wear lab coats anymore. Activities that qualify as tax-incentivized research and development are being carried out in almost every industry, including manufacturing, construction, architecture, engineering, research & development, transportation, agriculture, food and beverage, hospitality, IT, HR, and many others. Whether it’s a new material, a new food product ingredient, or an improvement to an existing product or process, it might be eligible for SR&ED.
To qualify for SR&ED, a business must meet the following criteria:
It’s important to note that a project does not need to be “succesful” for it to be eligible for SR&ED incentives. The SR&ED program is designed to encourage businesses to take risks as it pertains to innovation in Canada. The Canadian government encourages R&D activities that may lead to technological advancements and innovation, even if the projects do not result in commercial success.
Once the R&D project activities have been completed, its time to apply for SR&ED. A range of expenditures are eligible to be claimed, including; salaries & wages, materials, overhead, contract expenditures and capital expenditures.
Costs pertaining to marketing, market research and quality control, for example, are not eligible for SR&ED incentives.
Once R&D activities have been completed and materials have been gathered, the business must prepare its SR&ED claim. Claim preparation includes a description of the SR&ED work, the objectives, the methodologies used, and the eligible costs incurred. Businesses commonly work with a qualified SR&ED consultant or tax professional to prepare their SR&ED claims and maximize their tax incentives.
That’s where we come in. As professionals in the SR&ED application process, we can review your projects, determine which ones may be approved for SR&ED funding, and prepare and submit your claim for you. Entrusting Catax with your SR&ED claim is risk free for your business; we only get paid when your claim is approved.
Call us toll-free at 604 629 8863, or contact us today.