Dealing with technology? You might be eligible for government funding

SR&ED (Scientific Research & Experimental Development) is an incentive program by the Canadian government that refunds companies involved in Research and Development (R&D). (See the information about the program on the CRA website.) Canadian companies that spend money on creating or modifying products or processes through experimenting are eligible for SR&ED. Any company that deals with technology (software and hardware development, machinery, printing etc.) may qualify. If you created an entirely new industrial process or improved an existing one, if you took a database driver and rewrote it so its performance doubled, if you came up with a fuzzy logic algorithm to facilitate scheduling - all of this may be eligible. Innovation, uncertainties you overcame, and technological advancement are the criteria for eligibility. Even failed experiments may qualify. Non-Canadian owned companies also qualify, if they pay salary in Canada.
The SR&ED program is available to companies involved in Research and Development (R&D). Eligible expenditures include your time, employee and subcontractors labour, materials and equipment. SR&ED money is given as a refund for work already done.
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SR&ED tax incentive program - A War Chest for Small and Mid-size businesses

The ongoing economic recession and environmental concerns - these two issues make it more challenging for small and mid-size businesses in Canada not only to succeed, but in many cases to survive.

Did you know that the Government of Canada developed and implemented a unique program to help small and mid-size businesses operate successfully?
The SR&ED tax incentive program is a great “war chest” resource, especially during the current economic downturn.

Each year, the SR&ED program provides over $4 billion in refunds and tax credits to over 18,000 claimants. Of these, approximately 75% are small businesses.

Naturally, there are questions you might be asking yourself now. Some of those might be:

Your Question: What is the SR&ED program?

Our Answer: The Scientific Research & Experimental Development (SR&ED) program is a Canada Revenue Agency (CRA) initiative that provides incentives in the form of refunds and tax credits to Canadian businesses of all sizes, and in all sectors for R&D conducted in Canada.

Your Question: How does my business benefit from this program?

Our Answer: The SR&ED program helps you to:

- fund technological and environmental advances that keep your company competitive:
- maximize the return on your investment for the above initiatives
- better position your company for future R&D and experimental projects

Your Question: How much do I get?

Our Answer: Typically, SR&ED refunds range between $20,000 and $500,000.

Here is an example: Assuming your company spent $ 100,000 on salaries and $ 60,000 on consulting fees, and 75 percent of the labour and consulting fee was attributed as Experimental Development expenses, your claim size is as follows:

100,000x0.75x0.685 + 60,000x0.75x0.415 = $ 70,050

Have a look at some case studies here:

Now it’s our turn to ask you: Are you interested in getting $20,000- $500,000?
If yes, do you qualify for the SR&ED refund?

To qualify for the refund, you must:
- be an incorporated Canadian company
- have a payroll (the salary paid through T4), or consulting fees
- have production (it can be anything — software development, bakery, printing, metal forming, chemical manufacturing, etc.)

To determine if you qualify for an SR&ED refund, contact us:

Author: Dmitry Brusilovsky
Founder & Technical Director at SRED Unlimited
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