Are You Sure You’re Getting the Money You Deserve? Yes, we know, it’s an old story now – the Scientific Research and Experimental Development (SR&ED) tax credit program has been providing Canadian firms with some of the richest R&D incentives in the world for decades. That being said, due to some very common misconceptions, there are still a large number of firms that do not access the program at all, or do not access the full value of the cash and credits they rightly deserve.
“We don’t do R&D” – This sounds a bit tricky at first, but the large majority of the firms that make successful SR&ED claims don’t do traditional R&D – they do Experimental Development. What this simply means is they are working with their products and manufacturing processes to achieve incremental technology advances. If you are developing products, including software, or undertaking manufacturing operations in Canada, then it is very likely that some of your work will meet the definition of experimental development.
“Didn’t the government just change all the rules” – Over the past few years, the government has changed some of the rules about what spending can be included in the claim, but overall, the program remains one of the most lucrative in the world. In addition, there haven’t been any changes to the type of development work that is eligible. In fact, recent court cases and policy refinements have made things more clear in terms of what should and shouldn’t be considered SR&ED.
“We don’t have any scientists or engineers” – You don’t need any to be doing SR&ED. A great number of firms make successful claims without any scientists or engineers on staff – they have technically competent and qualified people doing work. Successful SR&ED claims are full of programmers, technicians, skilled tradespeople, and equipment and process operators – these are people both leading and supporting the problem-solving process.
“We missed our chance. Our big projects started last year” – The SR&ED claim becomes part of your annual tax return, so, each year, you prepare a SR&ED submission for the work you performed and the money you spent, in that year. It doesn’t matter when the project started or whether you filed a SR&ED project for that initial year of the project – you just pick up the project where it’s at as the tax year you’re evaluating begins. It also doesn’t matter when the project ends – you claim the project in successive tax years for the work done and money spent in each year.
“I didn’t know all of that. It really seems like we should reconsider what this program means for us” – Exactly – we couldn’t agree more. Give us a call Toll Free at 1-855-TAX-BACK (829-2225) to learn how the BeneFACT Consulting Group Team can help maximize your claim!