FAQ

• How much is paid and by whom?

• Is there a deadline to make a claim?

• How long does it take to get my refund?

• My company does not perform any formal science or R&D studies; do we qualify for SR&ED?

• Can a company that is not profitable and does not pay taxes, qualify for a SR&ED refund?

• Our Project is not complete or it failed to achieve our desired technological advance, do we qualify for SR&ED?

• Can a corporate structure that involves pooled costs and responsibilities be eligible for SR&ED?

• My company and I do R & D, however, our efforts are paid from various sources such as universities, pharmaceutical companies, government grants/subsidies and the like; is my company SR&ED eligible if they are involved?

• Will our company’s R&D and/or trade secrets be leaked if we share them with a SR&ED consultant or make an SR&ED claim?

• Will filing a SR&ED claim open our company up to a CRA tax audit?

• Is preparing a SR&ED claim is a highly complicated process that can only be completed by individuals with advanced degrees?

1. How much is paid? The value of your claim is based on all reasonable costs related to technological developments: labour, materials, overheads and capital equipment. The federal government will issue refunds or Investment Tax Credits (ITCs) up to 82% on labour when combined with provincial ITCs.

2. Is there a deadline to make a claim? The reporting deadline for corporations is 18 months from tax year end in which the costs were incurred. If this deadline is missed, the money is lost. For example, a year-end of Nov 30th 2008, has until May 31st 2010 to file their 2008 SR&ED claim. Fastest results are achieved by filing within 6 months of a fiscal year-end. Contact us now to avoid missed deadlines.

3. How long does it take to get my refund? CRA’s service time to process a SR&ED claim is four (4) months for those companies filing their T2s and SR&ED claims within 6 months of their year end and eight (8) months for those companies filing their T2s and SR&ED claims after 6 months of their year end.

4. My company does not perform any formal science or R&D studies; do we qualify for SR&ED? Most SR&ED claimants are small to medium businesses from nearly every industry sector that perform experimental development. That is, they utilize a systematic approach to achieving some technological advance/goal and attempt to overcome the technological obstacles associated with that goal.

5. Can a company that is not profitable and does not pay taxes, qualify for a SR&ED refund? Profitability has nothing to do with a company’s SR&ED eligibility. Claims are based solely on the costs associated with undertaking research and development.

6. Our Project is not complete or it failed to achieve our desired technological advance, do we qualify for SR&ED? Failures are a normal part of R&D. SR&ED eligibility rests on a company’s ability to prove their attempts to achieve a technological advance/goal and does not depend on the success of the project. Costs associated with these attempts are what is relevant and are claimed by the tax-year end regardless of project completion.

7. Can a corporate structure that involves pooled costs and responsibilities be eligible for SR&ED? Having a complicated corporate structure simply means you need a SR&ED expert. Upon review, we are often able to isolate the eligible R&D investment and thus, accurately cost your SR&ED projects for CRA purposes.

8. My company and I do R & D. However, our efforts are paid from various sources such as universities, pharmaceutical companies, government grants/subsidies and the like. Is my company SR&ED eligible if these other parties are involved? Having external parties pay for R&D does not necessarily exempt a company from being SR&ED eligible. Being clear about financial structures uncovers opportunities and avoids “double-dip” issues.

9. Will our company’s R&D and/or trade secrets be leaked if we share them with a SR&ED consultant or make an SR&ED claim? Confidentiality is strictly enforced at both Goulet Associates and CRA. It is not necessary for you to divulge trade secrets in order to obtain SR&ED funds.

10. Will filing a SR&ED claim open our company up to a CRA tax audit? Getting a SR&ED claim occasionally requires a SR&ED review. These cover only those financial activities that support your SR&ED claim – nothing more.

11. Is preparing a SR&ED claim a highly complicated process that can only be completed by individuals with advanced scientific degrees? For most companies, the secret to filing a SR&ED claim is specialized SR&ED experience and knowledge combined with sound scientific and accounting principles in a team approach. Goulet Associates has perfected a process to demystify and expedite the filing. Our clients learn from our experience and may ultimately become independent of us.