On October 18th 2021 the Canada Revenue Agency (CRA) published a press release that, among other things, reaffirmed their commitment to the SR&ED program – particularly for small businesses. The Scientific Research and Experimental Development (SR&ED) program supports research and development in Canada. The program provides more than $3 Billion in funding to over 20 000 companies in Canada each year. You can read more about SR&ED here – What is SR&ED? SRED Credits
In their press release, the CRA discusses the latest developments in the SRED program including the latest transformation of the Guidelines on the Eligibility of Work for SR&ED Tax Incentives (we have a piece that breaks this down in plain English here: SR&ED Eligibility).
The most interesting and noteworthy item in the press release, however, is a link to a page entitled Scientific, Research and Experimental Development – Success Stories. This is a hidden page on the Canada.ca website, it is hard to find and was not included on the government’s regularly updated What’s New in SR&ED page. The reason for the page’s lack of visibility is unknown, but presumably it is because quasi case-studies like this are a rare thing for the CRA to publish. Not only is it a privacy concern, revealing individual companies’ involvement in a tax incentive program, but through these 12 examples of what the CRA evidently considers “model SR&ED”, observers can get glimpse into what the CRA considers ideal SRED candidates.
Let’s break down each of the 11 relevant case studies and see what findings we can uncover about the inner workings of the SR&ED program.
*Before we dive into the weeds, we want to make it clear we are reading into PR content from the CRA and assuming that it correlates to what is going on behind the scenes. Whether this is true or not is unknown. What we know is that the people from the CRA that review SR&ED claims are likely not the ones who assembled these case studies. However, we can also assume that, in an organization such as the CRA, more than surface-level thought went into the case study examples and commentary used. *
Not a case study like the other 11 SR&ED examples, the CRA seems to be reminding us of the benefits of Non-Profit SR&ED Corporations and Third-Party Payments. We have a blog post coming soon detailing this process. Follow us on LinkedIn to stay up to date for the latest on SR&ED.
Such a collection of case studies is an uncharacteristic move from the Canada Revenue Agency. Keeping in mind our disclaimer regarding reading too much into these examples, we can assume that the case studies and descriptions are intentional, and not mere PR speak. If that is the case, here are things we may take away about the SR&ED program:
G6 Consulting Inc has over 12 years of experience specializing in the SR&ED program. SR&ED experts such as G6 often work on a contingency basis, with payment only based on a percentage of SRED credits once received. You can contact G6 for a free consultation here. https://www.g6consulting.ca/contact/