Does a company need to be incorporated to take advantage of SR&ED tax credits?
Frank Milito: No. You don’t need to be incorporated but there are different forms and filing requirements for individuals vs. corporations. Also, only corporations can qualify for the 35% rate. Individuals earn investment tax credits at the rate of 20% and only 40% of that can be refunded. Innodev: When should a small business or start-up take advantage of the SR&ED program? Frank Milito: Essentially if you are a Canadian company that carries out research in science or the development of technology in Canada, you should start considering the program as soon as possible. Many companies involved in advancing their products or processes generally have some work that meets the definition of SR&ED and we have quite a lot of information on our website to help businesses figure out if their work meets the requirements of the program. For example, a new tool that the Minister of National Revenue announced in November 2008 was the online Eligibility Self-Assessment Tool. This tool is available
Related Questions
- Does my Quebec incorporated company need a Federal Business Number (BN) issued by the Canada Customs and Revenue Agency (CCRA)?
- What are the advantages of a federally incorporated company versus a provincially incorporated company?
- Do the directors of a federally (Canada) incorporated company have to be Canadian citizens or residents?
