Common Concerns Regarding Filing an SR&ED Tax Credit Claim and How Braithwaite Can Help
By admin
Published On August 20, 2018
The Scientific Research and Experimental Development (SR&ED) Tax Credit is a lucrative Provincial and Federal program developed to increase growth and prosperity within Canada for CCPC organizations, non-CCPC organizations, individuals and members of a partnership.
While the tax relief program provides a lucrative return of SR&ED investment, there are common concerns shared among companies that they may eventually waive such opportunity to help with their cash flow. With many years’ of experience to assist clients to claim the SR&ED tax credit, Braithwaite helps our clients to address such concerns.
We are not sure if we have qualifying work?
SR&ED is defined for income tax purposes in subsection 248(1) of the Income Tax Act. However, it is still different from our common understanding of what research and development activity may consist of. In addition, the understanding of such qualifying requirements may vary in different industries, such as IT/Software, Manufacturing, Biotechnology, Pharmaceutical, etc. With our expertise in different industries and experience to assist clients in various sectors, Braithwaite can help you to bridge such knowledge gap, and customize a methodology to identify the R&D project(s).
We are not sure if it is worth investing the efforts to prepare a claim?
In general, the preparation of the SR&ED claim may be segregated into two aspects, i.e., technical and financial. Whilst helping our clients to identify a potential project list for further study, Braithwaite will also conduct a high-level costing estimation (with client’s initial input) to assess the potential size of the claim. This will provide a risk assessment and cost/benefit study of the potential claim before our clients invest more efforts to prepare the claim. With such study, we will help our clients to make a better decision and understand the potential return of the investments.
We don’t have an internal process to track R&D efforts. How do we make a claim?
In addition to helping our clients to prepare a claim, Braithwaite also assists our clients to establish a methodology and process for both current and future claims. The experience and interaction with CRA allows the Braithwaite team to have the most up-to-date understanding of the program and CRA’s requirements. With such knowledge, Braithwaite can design a method that is applicable in our client’s work environment.
What if we are audited by CRA?
As part of the tax return, it is common for CRA to oversee and administrate the SR&ED filings. Braithwaite provides an end-to-end service, which covers the entire preparation of the claim as well as the potential CRA reviews. Braithwaite has extensive experience in helping our clients to go through CRA reviews in various scopes, e.g., desk review, on-site review, etc. Therefore, when an audit happens, Braithwaite’s team will still be available to address any concerns and questions.
Braithwaite welcomes the opportunity to discuss any further questions you may have with the SR&ED Tax Credit. Contact the experts for your next claim!
