Scientific Research & Experimental Development
There are two things that have real value in business today – people and ideas. Most valuable of all are people with ideas. The Canadian Scientific Research & Experimental Development (SR&ED) program offers some of the most generous incentives in the world and we have an idea as to how you can access them.
Research & Development Tax Incentives
When you are looking for ways to raise funds to help you develop or improve products or processes, consider how much money you are currently leaving on the table. The SR&ED program’s tax incentives may apply to activities that are already taking place.
Under Canadian tax law, the key benefits of qualifying SR&ED expenditures include:
- Eligibility for investment tax credits (ITCs). Federally, these credits, which can reach up to 35 per cent of eligible expenses, may reduce tax payable, or for certain Canadian-controlled private corporations, be fully refundable in cash.
- A full tax deduction in the year the expenditures are incurred. This may even apply to R&D capital assets that are not just for regular commercial use.
- The ability to “pool” SR&ED expenditures, which enables you to indefinitely carry forward these deductions to the extent that they are not currently needed.
- Most provinces offer additional incentives for qualifying activities which increase the benefits of filing a claim. Effectively combined federal and provincial rates on labour, with proxy overheads added, can often exceed two-thirds of the underlying costs.
SR&ED activities are not limited to those taking place in a traditional research lab. Most claims are for experimental development which often takes place right on the shop floor. A project may start in a lab, but will not be completed there.
BDO's SR&ED brochure
Learn more about BDO's SR&ED services, including:
- Technical report preparation
- Financial information
- Documentation systems
- Claim reviews
Contact Us
To find out how we can help you, or for more information about our SR&ED Group please contact:
Mike McCreight, CA
National SR&ED Group Leader
