There is no better way to fund research and development (R&D) than through the Scientific Research and Experimental Design (SR&ED) program. Billions of dollars are given out through SR&ED spread across more than 20,000 recipients every year. This allows Canadian-controlled private corporations and other companies to innovate, conduct world-class R&D, improve efficiencies, reduce operating costs, increase market share, and secure higher profits.
SR&ED is not your traditional R&D grant. It is provided in tax credits after the work is completed. This means a business must pre-finance the project themselves, recuperating eligible expenditures after their project is approved. SR&ED requires that the work it is funding be conducted wholly in Canada. That is the minimum requirement. If parts of your R&D project are completed outside Canada, it is not an SR&ED project.
The SR&ED program is not difficult to qualify for. An applicant must fill out the required forms and have the supporting documentation for their claim. The forms can be quite complex and detailed, so many companies typically have an SRED consultant to ensure everything is complete and structured correctly.
Let’s learn about how to fund R&D projects with SR&ED financing: