A project is commissioned to produce a prototype (not to be sold) that will test a design for a new eco-petrol engine and exhaust. The goal is to achieve a substantial reduction in eco-unfriendly emissions with a performance at least as good as a comparable engine.
On the other hand, an innovative in-bus eco-waste bin, where the innovation is in the attractive and appealing presentation of different compartments designed specifically to encourage the usage and promotion of recycling, does not qualify. The uncertainty of persuading people to put their litter in the bin is in the field of social science, not in the field of technology. The technology required would be obvious to a competent engineer.
This appears to competent professional engineers to offer hope of achieving a real advance by way of an improvement in vehicle technology. The uncertainty in science and technology is whether this substantial reduction with the comparable performance sought is possible. Even if unsuccessful, this and the construction of the prototype is still a qualifying R&D project.
A project for a new standard bus engine which is substantially lighter, cheaper, or faster to produce than any currently available or known to be possible (for example patented), while maintaining performance levels (for example in power, robustness, and life) can all qualify as R&D. However, a minor and routine adjustment such as one to incorporate slightly better spark plugs, already designed and used in another vehicle, would not qualify.
Source: CRA (Canada Revenue Agency)