Have you had a bad SR&ED tax claim experience in the past? Unfortunately, one bad SR&ED experience can cause a complete loss of faith in the program and stop companies from claiming in future years. That’s a lot of unclaimed extra funds! Luckily, there are steps you can take to make your claim experience a bit easier.
It should be wonderful, full of promise and wealth, however the road to maximizing your SR&ED credits can be complicated, confusing and, if improperly handled, can result in a negative experience. That being said, SR&ED is an amazing and highly beneficial program that offers over $3 billion yearly in benefits. The key is to know what the CRA is looking for and create an organized process that keeps things moving smoothly the entire way – not just throwing everything together at the last-minute or leaving out important data.
We’ve put together some of our top tips for a smoother SR&ED tax claim experience, so you can miss most of the bumps in the road.
Be Honest, Not Modest
If you have done something incredible, compiling info for your SR&ED claim is not the time to say, “Aw, shucks. It was nothing. I guess it’s just part of the job.” Now is the time to say, “Look what we did. Look what we created. Look what we found out. Look what we fixed.” Your consultant will be looking at your projects with a fresh set of eyes. The best way to help them get all the facts is to be honest and excited about what projects you’ve been working on, who was involved and the time spent on the eligible activities.
Importance of Documentation
The most important thing you can do for a painless SR&ED experience is to keep good documentation. Whether you have official, stamped documents or simply sketches on scrap paper, it ALL counts and should be accumulated as you go along. If you decide to work with a SR&ED consultant, choose one that offers time tracking and documenting software as part of the package. That way you’re not scrambling at the last-minute, and it reduces the risk of misplacing or forgetting valuable information that may have a big effect on your claim.
Don’t Miss Your Deadlines
The big deadline to always keep in mind is that the claim must be submitted to the CRA 18 months from the fiscal year-end. Talk to any consultant and they’ll tell you the real rule of thumb for success is closer to 15 months. If a claim is at all incomplete, the missing segments will not count if it is late. A deadline of 15 months gives the CRA ample time to look into the claim, see if any further documentation is needed, and allows you to get the additional paperwork in before the 18 month deadline. In SR&ED, procrastination can equal money or credits lost.
Stay tuned for more great tips for a smoother SR&ED experience.
To learn more about the SR&ED program and how to maximize your claim, contact one of our BeneFACT company SR&ED experts today.