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Cash In On Your IT Innovations: How SR&ED Helps Credit Unions Stay Competitive


The technology needs of Credit Unions have become more diverse and complex. Keeping banking systems current amid constantly changing technologies and client expectations requires an ongoing financial investment that is outside of the realm of many Credit Unions; many have to use off-the-shelf systems that do not adequately meet their—or their members—needs. Tax credits can make developing a custom solution that helps take your Credit Union to the next level more affordable.

Under the Canada Revenue Agency’s Scientific Research and Experimental Development (SR&ED) tax credit program, Credit Unions may qualify for a refund of a portion of expenditures related to improving banking technology systems. Credit Unions spend a significant amount of money on IT and business process cycles to integrate the necessary third party services to provide insurance, brokerage, payment card and other services. Whether your Credit Union’s goal is improving reliability of a technology or process or some other improvement in their key performance indicators, you may be eligible for tax credits in relation to these improvements in your core or ancillary systems.

It is critical to work with someone who has the business and technical expertise to understand your Credit Union’s IT environment and related technology systems. A brief, high-level scoping meeting is the first step. During this meeting, management has the opportunity to get their questions about the SR&ED program answered and to ensure that the key factors necessary for qualifying for the program are present before proceeding with the claim preparation process.

The goal for claim preparation is to ensure transparency of the SR&ED program and claim process with minimal impact on the Credit Union’s resources and ongoing business objectives. Communication of program requirements helps to ensure that management and staff recognizes eligibility expectations going forward and can adapt as necessary to program requirements in subsequent years.

In today’s competitive environment, Credit Unions need to keep up with evolving technology and changing member requirements. Exploring the opportunities afforded by tax credits through the SR&ED program can allow your credit union to strengthen its position in the marketplace now, and in the future.