Many companies don’t file for SR&ED tax credits. Of course, some aren’t aware of the program, and then some simply don’t think they qualify when they do.
We understand that navigating qualifications and filing for the program itself can be challenging when companies have so much other work going on. This is why we thought we’d address some key misconceptions to help you determine if you do.
Below we’ll go through five of them.
1. We Don’t Do Scientific Research
If you’re a believer of this one, you aren’t alone. We’ve found many companies believe they don’t qualify because they don’t perform “scientific research.”
The good news is, SR&ED claims are for small experimental developments in process, design, quality, durability, energy efficiency and more. Quickly you can see how that opens up eligibility to all industry vertical markets that perform these tasks on a day-to-day basis.
2. What if the Work Isn’t Done by a Scientist or Engineer?
Qualifying work doesn’t have to be done by a scientist or an engineer, as long as you have technically competent and qualified people doing the work. Many successful SR&ED claims include programmers, project managers, technicians, skilled tradespeople, and process operators whether they are leading or supporting the problem-solving process.
Of course, if you do employ scientists and engineers, their work qualifies as well.
3. Our Secrets Are At Risk
Don’t worry. Your secrets are safe with us. Business Improvement Group offers a legally binding Non-disclosure Agreement (NDA) to our clients. In addition to this, we have always been at the forefront of deploying sophisticated IT security measures to safeguard sensitive information. Plus, a successful claim does not need to disclose sensitive information; only a short story describing the steps of your research.
If you’re worried about the CRA, they also follow strict confidentiality protocols and don’t accept any form of electronic communication whether it relates to technical or financial information.
4. We Missed Our Chance
If your projects started last year, you might be thinking you missed your chance. However, the CRA filing dealing for SR&ED submission is 18 months after the last day of your fiscal year. For example, if you had a December 2018 year-end then your claim deadline would have been June 2020.
It doesn’t matter when the project starts, you can claim the project in successive tax years if additional work is done.
5. Our Project Failed…
As the saying goes, it’s not a failure if you learned something from it- and you can still claim it. SR&ED funding is granted on the attempt of your project and not on its success. As failures are common on the path to technical advancement, the work simply goes into the technical obstacle criteria.
Are any of these misconceptions holding your business back from filing or maximizing your SR&ED claim?
Even if your work doesn’t involve lab coats or microscopes, you could still qualify for SR&ED tax credits. The CRA follows strict protocols to keep your projects a secret, you have eighteen months to file, and even if the project wasn’t successful, it could still be claimable.
At Business Improvement Group we are SR&ED experts. Our clients can be assured that they will be assigned consultants that have a deep understanding of their industry and work with you to recognize unclear and under-claimed qualifying work. From our free on-site assessment to our ongoing assistance with claims, we are with our clients each step of the way.
You can learn more about us here.
Or request a consultation here.
*The information above is meant for informational purposes only, and not to be used as advice.
You might also be interested in our post SR&ED: the Basics.