[1] The SR&ED program is intended to encourage businesses of all sizes, particularly small to medium and start-up firms, to conduct research and development (R&D) that will lead to new, improved, or technologically advanced products, processes, devices, and materials.
Federally, the maximum Investment Tax Credit (ITC) depends on the company's legal status and amount of qualified expenditures for SR&ED carried out in Canada.
In 2013, The CRA made additional changes to the T661, where Consultants are now required to provide their agreement and the amount they charge to clients in return for filing claims on their behalf.
The SALT is CRA's web-based tool that is used to determine through a series of concise questions if work performed has a likelihood of meeting SR&ED requirements for funding.
[18] Canada Revenue Agency (CRA) and corresponding provincial tax authorities require all SR&ED claimants to submit their claim no later than 18 months after the effective fiscal year.
Some firms are in need of their SR&ED refund far sooner than the CRA can process their claim, therefore public and private lenders provide financing solutions to claimants.
Given the possibility of review or audit by CRA, claimants are strongly encouraged to keep contemporaneous documentation that proves the advancement in a given area of science or technology, as well as associated expenditures.
Retroactively documenting eligible SR&ED work is highly discouraged and increases a taxpayer's risk of having a claim reduced or even outright rejected.