Scientific Research and Experimental Development (SR&ED)

What is SR&ED

Science Research and Experimental Development (SR&ED) pronounced (SHRED) is a federal tax incentive program here in Canada. The Canadian government supports innovation in Canada by providing a tax incentive for innovative work performed in Canada. Research and Development work in Canada does not guarantee SR&ED eligibility as CRA has their own guidelines in relation to what constitutes SR&ED work. SR&ED is claimed at the end of each fiscal year and is administered by CRA.

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As defined by CRA, this means there is a systematic investigation or search that is carried out in a field of science or technology by means of experiment or analysis and that is: 

(a) basic research

(b) applied research 

(c) experimental development

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The method to establish this involves answering the following questions:

1. Was there a scientific or a technological uncertainty?

2. Did the effort involve formulating hypotheses specifically aimed at reducing or eliminating that uncertainty?

3. Was the overall approach adopted consistent with a systematic investigation or search, including formulating and testing the hypotheses by means of experiment or analysis?

4. Was the overall approach undertaken for the purpose of achieving a scientific or a technological advancement?

5. Was a record of the hypotheses tested and the results kept as the work progressed?

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At Colum Consultants we can help you better understand if you meet the requirements for SR&ED as set out by CRA. 

To discuss this further book a 15 minute complimentary consultation.