What Is SRED
The Scientific Research and Experimental Development (SR&ED) tax incentives are intended to encourage businesses to conduct research OR development in Canada
- Experimental Development can include technologies across a wider range of industries – Examples : Engineering, Software and hardware, Food and Drink, Construction, Manufacturing, Machine shops, woodwork, agriculture / growers
- Pure and Applied research is also allowed – Medical, healthcare, pharma, cosmetics, biotechnology
What is the Value of the SR&ED Federal and Provincial Tax Credits?
- Federal and Provincial Tax Credits Are Available
- In Ontario, approximately 65% of salaries assigned to the project can be claimed back
(Dividends not eligible). - Material Consumed or transformed (e.g. prototypes) and Contractors can be claimed around 40%.
- Most tax credits are refundable.
What Are the Component Elements of a Claim?
- Identification of a Technological Obstacle or Scientific Uncertainty (knowledge gap)
- Carry out Due Diligence (is the information already available in the public domain)
- Developing a hypothesis
- Carrying out a Systematic Investigation by means of analysis or experimentation
- Demonstrating Scientific or Technological Advancement
- Keeping records