SR & ED is an acronym for
Scientific Research and Experimental Development so it stands to reason that the
SR & ED Program is one that deals with research and development. More than that though, the
SR & ED Program is one specifically geared towards Canadian & Ontario companies and offers them tax incentives to conduct research in Canada that will better technology for all.
This Federal program offers Canadian companies of all sizes and from every walk of life the opportunity to conduct advanced research and development in an effort to encourage new and innovative ideas, processes, and products that are all technologically advanced. Those who qualify can apply for
SR & ED Program investment tax credits, or ITCs, for a variety of expenses including:
• Various Materials
• Various Machinery
• Various Overhead
• Various Wages Paid
• SR&ED Contracts
Qualifying Scientific Research & Experimental Development (SR & ED) ProjectsNot all projects will qualify a company to be eligible for the many ITCs that are offered each and every year. In order to qualify for the ITCs offered with the
SR & ED Program, a company’s work must accomplish three things including:
1. Advance the current understanding of a specific scientific technology.
2. Deal with scientific or technological vagueness or uncertainty.
3. Integrate a methodical and systematic investigation by qualified persons only.
Additionally, there are only certain types of work projects that qualify for the
SR & ED Program ITCs. Most commonly, the work that will be approved for the
Scientific Research & Experimental Development Program will be in the areas of experimental development, applied research, basic research, and support work. Of course, these only qualify if they meet all three qualifying criteria.
Often there are companies that will apply to be a part of the program, but they will fail to meet the criteria needed in order to make them eligible. At present, activities such as social science research, production of an improved commercial product, general market research, general sales promotion, quality control, prospecting for gas and/or other resources, and routine data collection do not qualify for the ITCs offered through the SR&ED Program.
Advancing Canada and the WorldThe
Scientific Research & Experimental Development Program is presently the largest Canadian Federal program that supports research and development. Each year there are several billion dollars in ITCs that are handed out to over 18,000 companies. As almost 74% of the companies qualifying for the program are start-up to small businesses, the
SR & ED Program truly offers companies a way to advance not only Ontario, Canada in the realm of technology, but the entire world as well.
