SR&ED Tax Credit Eligibility: Criteria: 4 Key Requirements Your Business Must Meet
The Three Core Eligibility Criteria for SR&ED Tax Credits
To qualify under the Scientific Research and Experimental Development (SR&ED) tax credit program, a project must meet three fundamental criteria established by the Canada Revenue Agency:
- Technological Advancement: The work must aim to achieve scientific or technological progress beyond existing knowledge or standard practice.
- Scientific or Technological Uncertainty: There must be uncertainties or technical barriers that cannot be resolved using routine engineering or standard procedures.
- Systematic Investigation or Experimentation:The work must be carried out through a structured and systematic process of experimentation, analysis, or testing performed by qualified personnel.
These three elements must work together: the systematic investigation must directly address the identified technological uncertainty in order to achieve measurable advancement.
The Fourth SR&ED Eligibility Requirement Often Overlooked: Documentation
Beyond the scientific criteria, a fourth essential requirement is frequently underestimated: contemporaneous documentation and financial records. Businesses must maintain clear technical documentation and supporting financial evidence demonstrating that:
- Eligible SR&ED activities were performed.
- Scientific or technological uncertainty was addressed.
- Qualified expenditures were incurred in attempting advancement.
Expert Guidance Makes the Difference in SR&ED Approval | Pro Gestion
Meeting the four SR&ED requirements is the difference between approval and denial. Pro Gestion combines scientific and tax expertise to identify qualifying projects, substantiating your claim with the necessary technical and financial evidence. Our team builds defensible claims that maximize your recovery and increase your probability of success.
Optimize your SR&ED tax credits today
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