How to Get IRAP Funding: The Definitive Guide

The National Research Council of Canada Industrial Research Assistance Program (NRC IRAP) is a leading innovation assistance program in Canada for small and medium-sized businesses. IRAP funding is smaller and harder to get than the excellent SR&ED credits program, but none the less IRAP funding is a great thing for businesses that qualify. In 2020, IRAP funded 3302 companies totaling $335.7 million in funding. Companies that can get IRAP should always do so because both IRAP and SR&ED can be claimed by a company. People often hear that IRAP funding cancels out SRED. This is not the case. IRAP reduces your SRED credits received, yes. But IRAP credits are deducted from SRED expenditures. This means that for every $1 of IRAP you receive, your SRED (for an Ontario CCPC) will go down by 42 cents. You’re always ahead taking advantage of as much IRAP and SRED as possible.

What is IRAP?

The National Research Council of Canada Industrial Research Assistance Program (NRC IRAP) is a federal program and grants businesses funding to complete a research and development project that will help the business in its decision-making process. The overall objective of the program is to accelerate business innovation to benefit the Canadian economy. IRAP is a program funded jointly by the federal government and the provinces, as well as by various agencies and non-profit associations such as major universities.

Here’s a blurb from the NRC on What is IRAP?

What is IRAP AIP?

Spoiler alert: The AIP was a 2020-only program which disbursed emergency funding as part of the federal government’s COVID economic impact mitigation efforts. I discuss IRAP AIP here because people ask me about it. The AIP Is closed to new applicants.

Applications for NRC IRAP’s $250 million Innovation Assistance Program (IAP) opened in February 2020. The IAP was intended to help support pre-revenue, start-up and scale-up companies.

IRAP IAP provided a wage subsidy to eligible employers for up to 12 weeks. SMEs pursuing technology-driven innovation who had been unable to secure funding under the Canada Emergency Wage Subsidy (CEWS) were eligible and could apply for financial assistance under IRAP IAP. The call for applications will close Wednesday, April 29, 2020. There was a second tranche of IAP funding in November, 2020 of $155M. IAP is now closed. 


  • Be ineligible for the Canada Emergency Wage Subsidy
  • Be an incorporated, profit-oriented small or medium-sized business in Canada
  • Be a company with 500 or fewer full-time equivalent employees
  • Plan to pursue growth and profit by developing and commercializing innovative, technology-driven new or improved products, services or processes in Canada
  • Lack of sufficient financial resources to sustain operations during the COVID-19 downturn period
  • Have a Canada Revenue Agency business number
  • Be incorporated by no later than March 1, 2020


The IRAP program is a traditional R&D funding program run by the National Research Council. It’s method of operation will be familiar to grad students and traditional researchers who are used to applying for grant money in a university or research organization setting. Essentially you apply for IRAP and tell them what good R&D things you will do if they give you funding. IRAP funds in advance. This is an advantage over SRED which funds in arrears, after the close of a company’s fiscal year. IRAP will sometimes fund business development and marketing activities. These activities are never funded by SRED. IRAP operates on a fixed budget which it receives annually based on the federal government year, April 1 to March 31. This means that when you apply for IRAP you are competing against other companies’ proposals based on both technical merit and timing. Right now, in August 2021, IRAP is out of money for the year. That’s obviously bad. SRED is embedded in the Income Tax Act. If you meet the requirements of the Program you will receive your funding. You are not competing against other SRED applicants for a limited pot of funding.

IRAP is targeted towards start-ups and “hard-core R&D activities. SRED is a much larger program which funds experimental development in commercial and industrial firms engaged in a very broad range of technology areas.

IRAP is an intrusive, hands-on process. As you proceed through the IRAP application then the granting process, you are assigned an Industry Tech Advisor, ITA, who works with you to build an IRAP application and business case. Simplistically, IRAP funds technology headcount at up to an 80% level. They will fund subcontract work up to a 50% level. Part of the application process is showing that you have the means to fund the rest of your operation including the 20% of tech staff not funded by IRAP etc. SRED by contrast is a self-directed process, much like filing your corporate taxes. SRED claims are subject to review and audit, but there is no day to day monitoring or counselling relationship as there is with the IRAP ITA.

How To Qualify For IRAP Funding

Many start-ups and small high tech firms are introduced to IRAP through industry associations, university connections or tech incubators. Referring organizations include MaRS, Oakville Corp Center, U of Waterloo Accelerator Center, Ottawa Comm Research Center, U of T’s Hatchery Program etc.

If you’re not affiliated with any of these groups, you simply pick up the phone and apply to IRAP by calling 1-877-994-4727. If you’re a G6 SRED customer, we can help you get your IRAP application started at no extra charge. You shouldn’t pay for an “IRAP consultant”. The application process is not difficult and the ITA you are assigned by NRC will work with you through the process. Here’s a blurb on qualifying for IRAP and the process involved:

Depending on your province of operation, there may be a requirement to show some revenues as a prerequisite for IRAP funding. In Ontario, for example, since about 2017, companies successfully applying for SRED had to show minimum revenue from operations of $500K lifetime. This requirement varies by locale and sometimes it can be satisfied by consulting revenues (for example) not directly related to the product or process in the IRAP grant application.

Get your SR&ED done right with G6 Consulting Inc – Canada’s R&D Tax Credit Experts!

G6 Consulting can work with you to build your claim, co-ordinate with your accountant, submit your claim and get you your cheque. No cost until you get paid

Check out our SR&ED overview page to learn more about SR&ED and how to qualify

Contact an Expert for a free no obligation consultation to see if your business can qualify

Check out our SR&ED calculator to get an idea of how big your SR&ED cheque could be

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.

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