Scientific Research and Experimental Development
The current research and development (R&D) expenses your business incurs may be eligible for up to a 70 percent refund from the Canadian government under the Scientific Research and Experimental Development (SR&ED) Investment Tax Credit Program. This program encourages Canadian businesses of all sizes and in all sectors to conduct R&D in the pursuit of scientific and technological advancements that may lead to new or improved products or processes.
With more than $3 billion a year in funding, the SR&ED program is the largest single source of federal government funding for business-led R&D. However, with stringent requirements, careful attention must be paid to the filing process for SR&ED claims. Our team consists of tax and technical professionals, including scientists, engineers and IT specialists who understand the nuances of your R&D.
Who qualifies?
- Canadian controlled private corporations (CCPCs, refundable)
- Publicly owned corporations (non-refundable)
What types of research?
- Basic research: Advancement of knowledge, no practical application in view
- Applied research: Advancement of knowledge, practical application in view
- Experimental development: Technological advancement to create new materials, devices, products or processes
What costs are covered?
- Salaries and wages
- Canadian subcontractor payments
- Materials consumed and transformed
- Third-party payments
- Overhead expenses
How to plan for an SR&ED claim
Comprehensive planning, along with in-depth technical and financial reporting, will increase your funding opportunities and enable you to get the most out of your innovation.
How we can help
Develop accurate project descriptions
Capturing all the information you need when preparing your SR&ED claim can be a time-consuming process. Our advisors assist you in transforming information into sound technical descriptions and compiling the required documentation to support your claim.
Training your team
MNP can provide your staff with valuable training and advice so they can identify eligible projects and produce the required documentation to support a claim.
Defend your claims in CRA audits
If the CRA reviews your SR&ED claim, our advisors can help by clarifying processes, working with tax authorities, and helping you avoid costly reassessments through tailored guidance.
Strategic tax planning
SR&ED tax credits can significantly impact your bottom line, making proactive planning essential. MNP assists with evaluating project eligibility, establishing control systems, reviewing contracts for compliance, and optimizing claims alongside other credits to ensure maximum benefit.
How to file an SR&ED claim
In this insightful video, Jay McLean, MNP’s National SR&ED Services Leader discusses effective planning strategies for filing a SR&ED claim to get the most out of funding opportunities.
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Tax credits for life science companies
Life sciences companies drive health innovation through R&D—advancing drugs, devices, and technologies. Yet these resource-intensive efforts demand cost-efficient strategies to unlock discoveries and improve care.
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Contact our Tax team
Jay McLean CPA, P. Eng, MBA, BASc.
Partner, National SR&ED Leader
Jay McLean is a MNP Partner and national leader of the Government Incentive practice including: Scientific Research & Experimental Development (SR&ED) tax credits and Ontario Interactive Digital Media tax credits (OIDMTC), and more.
He is a designated accountant and engineer with more than 20 years of experience working with companies from varying industry sectors. The majority of Jay’s client work is with SME private companies. Jay is committed to providing clients the highest and most efficient service possible in all situations, and as such will coordinate service engagements.
As the leader of the national SR&ED practice, Jay’s experience spans a variety of R&D settings, prototyping, and production environments including: development of new materials, engineering consulting companies, software development, manufacturing settings and more. Jay also has considerable experience leading SR&ED audits with the Canada Revenue Agency to very successful outcomes.
He is a graduate of both University of Waterloo and Wilfrid Laurier University. Jay is also a member of the Chartered Professional Accountants of Ontario, and the Professional Engineers of Ontario.