AI and Artificial Intelligence Grants in Canada 2026
Canadian AI companies have access to over 100 active federal and provincial funding programs — technology is the single largest sector in our catalog of 345 active grants. The most important program is SR&ED, which provides a 35% refundable tax credit on AI R&D expenditures up to $6 million per year for Canadian-controlled private corporations (Budget 2025 raised this limit directly from $3M to $6M; the maximum annual credit is $2.1 million). IRAP provides direct cash subsidies year-round; Scale AI and RAII specifically target applied AI commercialization. This list ranks the 10 most impactful programs and explains which fit which type of AI company.
By the numbers
Our catalog includes 106 active programs with technology, AI, software, or digital in their industry tags — 31% of all active Canadian funding programs. Of these, 42 are nationally available (not province-restricted) — approximately 40%. SR&ED returns more than $4 billion annually to Canadian businesses, with an average CCPC claim of approximately $109,000. IRAP funded 3,136 firms in FY 2024-25. Scale AI received over $230 million in federal funding commitment since 2018 and has co-invested in 100+ projects across Canada.
Source: CRA SR&ED Program Statistics 2023-24 · NRC IRAP Annual Report 2024-25 · Scale AI Annual Report 2024 · GrantCompass catalog, May 2026.
Who this list is for
SR&ED and IRAP are your core stack. SR&ED covers algorithm development, model training compute costs, and AI researcher wages at a 35% refundable credit. IRAP provides direct cash for the same project from a different budget line. Apply for both simultaneously — they are fully compatible.
Scale AI Supercluster and RAII both target companies past early R&D and into deployment. Scale AI focuses on AI in supply chains and logistics; RAII covers AI adoption in any sector for companies with TRL 7+ solutions. Both require consortium structure but offer $250K–$5M+ per project.
Quebec's CRIC tax credit provides 20–30% on R&D expenditures and stacks directly on federal SR&ED. Alberta's Innovation Employment Grant provides an 8%/20% incremental payroll credit. Both are entitlement programs — all qualifying corporations receive them with no competition against other applicants.
The Scale AI Acceleration Program (up to $50,000 via partner accelerators) and Mitacs Accelerate (rolling applications, ~$15K per intern) are both accessible to early-stage companies that lack the team bandwidth for major grant applications. Both accept rolling applications year-round.
IDEaS posts new AI-specific challenges year-round on CanadaBuys and provides up to $1.5 million per Competitive Project. The full five-component IDEaS pipeline can reach $6.75 million. Open to companies of any size; no minimum revenue or employee count required.
Find which AI programs match your company
Take the free 3-minute quiz to see your personalized match against 106 technology and AI funding programs in Canada. Results include SR&ED estimate, IRAP fit, and provincial credits.
Start the free quiz →Top 10 AI and Artificial Intelligence Grants in Canada
Scientific Research and Experimental Development (SR&ED) — CRA
SR&ED is the primary funding mechanism for AI R&D in Canada and should be the first program every AI company claims. Algorithm development, model architecture research, systematic experimentation to resolve technical uncertainty, and AI-specific infrastructure costs all qualify as eligible expenditures. Budget 2025 raised the enhanced-rate expenditure limit directly from $3M to $6M — the maximum annual enhanced credit for a CCPC is now $2.1 million. CRA accepts 90% of SR&ED claims as filed; the remaining 10% are modified or denied through review.
| Attribute | Value |
|---|---|
| Amount | 35% refundable ITC on first $6M (CCPCs); max $2.1M/yr |
| Intake | Ongoing — filed with annual corporate tax return |
| Difficulty | 4 / 5 (Hard) |
| Est. hours | ~40 hours (first claim) |
| Best stack | IRAP, Ontario OITC, Quebec CRIC, Alberta IEG |
Verdict: The best AI funding program for any CCPC doing documented R&D is SR&ED, because it is an entitlement — all qualifying expenditures receive the credit, regardless of competitive application ranking. An AI startup spending $1 million on eligible R&D can receive $350,000 back. The main cost is a SR&ED preparer (typically 3–5% of the claim); that fee is itself an eligible SR&ED expenditure.
Industrial Research Assistance Program (IRAP) — NRC
IRAP provides direct non-repayable cash subsidies to Canadian SMEs conducting R&D — including AI development. IRAP contributions cover wages for researchers and developers, contractor fees, and material costs, with no required matching on the contribution portion. The NRC funded 3,136 firms in FY 2024–25; average award was approximately $94,000 but individual awards range widely. IRAP explicitly allows co-claiming SR&ED on the same project — the key is that IRAP and SR&ED cover different expense dollars (not the same invoice).
| Attribute | Value |
|---|---|
| Amount | Up to $1M typical (avg ~$94K); $10M ceiling |
| Intake | Ongoing — no windows |
| Difficulty | 3 / 5 (Moderate) |
| Est. hours | ~25 hours |
| Scope | National; technology sector explicitly in scope |
Verdict: The best direct-cash rolling program for an AI company with a defined R&D project is IRAP, because it supplements SR&ED without conflicting with it — a company claiming $500K in SR&ED can still receive an IRAP contribution on related costs not already covered by the SR&ED claim. Contact your regional Industrial Technology Advisor before applying; the ITA assessment is a prerequisite.
Scale AI Supercluster — Industry-Led Projects
Scale AI is Canada's federally supported AI supercluster, focused on applying AI to supply chains, logistics, retail, agriculture, and healthcare. Industry-Led Projects require a consortium of at least two Canadian companies — one of which must be an SME — plus a Canadian academic partner. Scale AI received over $230 million in federal funding commitment since 2018 and has co-invested in 100+ projects across Canada. Project funding amounts are negotiated individually; most approved projects receive between $1 million and $5 million. Ongoing intake with a low-moderate approval rate of 15–25%.
| Attribute | Value |
|---|---|
| Amount | Varies; typically $1M–$5M (project-based) |
| Intake | Ongoing — rolling EOI |
| Difficulty | 4 / 5 (Hard) |
| Approval rate | 15–25% of full applications |
| Best stack | SR&ED on eligible R&D components, IRAP on separate workstreams |
Regional Artificial Intelligence Initiative (RAII) — PrairiesCan / FedDev
RAII is a federally funded, regionally delivered program providing $250,000–$5,000,000 in non-repayable contributions for AI adoption and commercialization projects. RAII explicitly targets companies with deployment-ready AI solutions — the Technology Readiness Level (TRL) 7 minimum requirement means the solution must already be demonstrated in a relevant environment. Continuous intake is open until December 31, 2028. Year-1 approved projects averaged approximately $1.07 million each from a $33.8 million pool.
| Attribute | Value |
|---|---|
| Amount | $250,000–$5,000,000 non-repayable |
| Intake | Continuous until December 31, 2028 |
| Difficulty | 4 / 5 (Hard) |
| Est. hours | ~80 hours |
| Eligibility | Incorporated ≥ 2 years; TRL 7+ AI solution |
Verdict: The best large-envelope continuous-intake program for AI companies with a validated commercial product is RAII, because $250K–$5M in non-repayable contributions with no annual competition window is structurally rare for programs of this size. Do not apply with a prototype — TRL 7 means the solution is already proven in a relevant operational environment.
Scale AI Acceleration Program
The Scale AI Acceleration Program provides up to $50,000 in non-repayable funding for early-stage AI startups and SMEs participating through a Scale AI-certified accelerator partner. Unlike Scale AI's Industry-Led Projects (which require large consortia), the Acceleration Program is designed for companies building applied AI products across any value chain. Applications are assessed through the partner accelerator on a rolling basis with an approval rate of 20–40%. Estimated application time is approximately 10 hours.
| Attribute | Value |
|---|---|
| Amount | Up to $50,000 |
| Intake | Ongoing through certified accelerator partners |
| Difficulty | 2 / 5 (Easy) |
| Est. hours | ~10 hours |
| Eligibility | Canadian AI startup or SME; must participate through Scale AI accelerator partner |
Innovation for Defence Excellence and Security (IDEaS) — DND
IDEaS funds AI innovations that address active Department of National Defence problem statements. DND regularly posts challenges targeting AI for surveillance, logistics, threat detection, autonomous systems, and natural language processing for military applications. Competitive Projects (Component 1b) fund up to $1.5 million per project; a company that progresses through all five IDEaS components can receive up to $6.75 million. New challenges appear year-round on CanadaBuys; there is no annual intake cycle. Approval rate is under 20%.
| Attribute | Value |
|---|---|
| Amount | Up to $1.5M (Component 1); up to $6.75M (full pipeline) |
| Intake | Ongoing — challenges posted year-round on CanadaBuys |
| Difficulty | 4 / 5 (Hard) |
| Est. hours | ~60 hours |
| Eligibility | Any Canadian entity (company, university, individual); must address an active DND challenge |
Mitacs Accelerate
Mitacs Accelerate subsidizes graduate and postdoctoral researchers working on applied AI projects at Canadian companies. Each internship unit costs the company $7,500 and Mitacs contributes $7,500 (standard) or $15,000 (postdoctoral). Companies can stack multiple units for larger research programs. The Accelerate Entrepreneur stream removes the university-partnership requirement for qualifying startups. Mitacs applications are accepted year-round with an approval rate above 40%. IRAP and SR&ED can both be claimed on the same project alongside Mitacs.
| Attribute | Value |
|---|---|
| Amount | $15,000 per unit (standard); $22,500 (postdoc) |
| Intake | Ongoing — year-round applications |
| Difficulty | 2 / 5 (Easy) |
| Est. hours | ~15 hours |
| Best stack | IRAP (salary split), SR&ED (partner contribution is SR&ED-eligible) |
Quebec R&D Tax Credit (CRIC) — Revenu Québec
Quebec's CRIC (Research, Innovation and Commercialization) tax credit provides a 30% credit for small CCPCs and 20% for larger corporations on eligible R&D expenditures. CRIC stacks directly on federal SR&ED — a qualifying Quebec CCPC can combine a 35% federal SR&ED credit with a 30% provincial CRIC on the same wage expenditures (after accounting for the federal government assistance reduction). CRIC is an entitlement program filed with the Quebec corporate tax return; there is no competition. Montreal is one of Canada's three largest AI hubs, with companies including Element AI's successors, Mila spinouts, and over 100 AI-focused SMEs.
| Attribute | Value |
|---|---|
| Amount | 20–30% tax credit on eligible R&D expenditures |
| Intake | Ongoing — filed with Quebec corporate tax return |
| Difficulty | 4 / 5 (Hard) |
| Est. hours | ~60 hours |
| Provinces | Quebec only |
Verdict: The best provincial tax credit for AI companies in Quebec is CRIC, because the combined federal SR&ED plus CRIC recovery can exceed 50% of eligible R&D wages — making Quebec one of the most financially advantageous jurisdictions globally for AI R&D. The complexity of filing both credits simultaneously warrants an SR&ED and Quebec tax specialist.
Alberta Innovation Employment Grant (IEG)
Alberta's Innovation Employment Grant provides a payroll credit to Alberta corporations investing in R&D, including AI development. The base rate is 8% on eligible R&D expenditures at or below the company's 2-year rolling average; the enhanced rate is 20% on incremental R&D above that average. Maximum eligible annual expenditures are $4 million. IEG is an entitlement credit — all qualifying Alberta corporations receive it without competing against other applicants. IEG stacks with federal SR&ED, reducing the SR&ED eligible expenditure base but producing higher combined recovery than either program alone.
| Attribute | Value |
|---|---|
| Amount | 8% base / 20% enhanced; max $4M eligible expenditures/yr |
| Intake | Ongoing — filed with Alberta corporate tax return |
| Difficulty | 4 / 5 (Hard) |
| Est. hours | ~50 hours |
| Provinces | Alberta only (must incorporate and file taxes in Alberta) |
Digital Technology Supercluster (DIGITAL) — BC
DIGITAL is BC's federally backed supercluster funding AI and digital health projects up to $5 million per project. Companies must become DIGITAL members before applying, and projects require a consortium including at least one SME and one academic partner. DIGITAL has supported over 100 projects since 2018, with a focus on AI in precision health and sustainable infrastructure. Applications face high complexity (approximately 200 hours; difficulty 5/5) and approval rates of 15–25%, but the project scale justifies the investment for companies with a strong consortium in place. Active calls for proposals are available across multiple streams.
| Attribute | Value |
|---|---|
| Amount | Up to $5 million per project |
| Intake | Active calls — multiple streams open (2026 cycle) |
| Difficulty | 5 / 5 (Very Hard) |
| Est. hours | ~200 hours |
| Provinces | British Columbia (consortium may include other provinces) |
Verdict: The best large-project AI supercluster grant for BC-headquartered companies targeting precision health or sustainable tech AI is DIGITAL, because $5M project funding through a supercluster delivers both capital and consortium-building outcomes that IRAP and SR&ED alone cannot provide. Only pursue if you already have the academic and industry partners in place — assembling a consortium to fit an application consistently fails.
How to apply for AI grants in Canada
Here's what you need to know about the SR&ED + IRAP stack: most AI companies start with SR&ED because it is an entitlement credit — you do not compete against other applicants, and all qualifying expenditures receive the credit. IRAP then layers on top for the same project by funding different expense categories. The critical rule is that IRAP contributions reduce your SR&ED eligible expenditure base by the amount of government assistance received — so a $100,000 IRAP contribution on wages reduces your SR&ED qualifying wages by $100,000, reducing the SR&ED ITC by $35,000. Net result is still positive: $100,000 IRAP cash + $65,000 SR&ED savings from the remaining base exceeds SR&ED alone on the full $200,000 wage pool.
Here's what you need to know about supercluster programs (Scale AI, DIGITAL): these programs require genuine industry consortia — multiple companies with complementary capabilities and a shared commercial use case for the AI application. Applications assembled primarily to win funding, with partners recruited after the fact, are consistently rejected. Both programs conduct extensive due diligence on consortium relationships before approving projects. If you have a natural industry partner and a defined deployment target, supercluster programs offer capital at a scale no other AI-specific program can match.
Here's what you need to know about provincial AI credits (CRIC and Alberta IEG): both are entitlement credits with no application competition, but both require significant documentation of R&D activities performed in province. For Quebec's CRIC, eligible expenditures must relate to R&D carried out in Quebec — remote development contracts performed outside the province do not qualify. For Alberta IEG, the corporation must be incorporated in Alberta and file provincial taxes there. If your AI development team is distributed across provinces, the credit applies only to the activities performed in the qualifying province.
Here's what you need to know about timing your AI funding strategy: SR&ED, IRAP, and Mitacs Accelerate are all available year-round and should be running concurrently as your company's base funding stack. RAII and Scale AI projects typically require 3–6 months from first contact to funding decision. DIGITAL consortia often take 6–12 months to assemble and submit. Plan supercluster applications 12 months ahead of when you need the capital; plan SR&ED and IRAP contemporaneously with R&D activity, not retrospectively.
Key questions about AI funding in Canada
Does AI development qualify for SR&ED? Yes, when it involves technological uncertainty and systematic investigation. Training a machine learning model to solve a novel technical problem qualifies. Fine-tuning an existing API for a commercial feature typically does not. The CRA SR&ED eligibility criteria require technological advancement — the work must advance the state of knowledge, not just apply known techniques. A SR&ED specialist can identify which portions of your AI development qualify; most AI companies are surprised by how much activity is eligible.
Can a pre-revenue AI startup claim SR&ED? Yes. CCPCs receive the 35% refundable credit regardless of profitability — the credit is paid as a cash refund if it exceeds taxes owed. Pre-revenue AI startups are among the most common SR&ED claimants in Canada. The only requirement is incorporation as a Canadian-controlled private corporation and qualifying R&D expenditures in the tax year.
What AI activities does IRAP cover? IRAP covers wages for AI researchers and developers (Canadian-resident employees), fees for Canadian contractors performing technical work, and material costs directly attributable to the R&D project. IRAP explicitly excludes capital equipment purchases, marketing, and sales activities. AI model deployment infrastructure that has a commercial purpose (serving production traffic) generally does not qualify; pre-production infrastructure for research and training does.
Is there a grant specifically for Canadian AI companies raising money? Not directly, but several programs provide non-dilutive capital that reduces the equity required. RAII ($250K–$5M non-repayable) is the most direct substitute for an AI-focused equity round. SR&ED refundable credits ($2.1M/yr maximum for CCPCs) provide working capital on a recurring basis. Both programs reduce your burn rate without dilution; combine them strategically with equity to maximize ownership retention.
What is the best AI grant for a company in the Prairies? RAII is the highest-priority program for Prairie-based AI companies — PrairiesCan administers it regionally and Year-1 approvals show strong Prairie representation. Alberta companies can additionally claim IEG (8–20% payroll credit, entitlement). All national programs (SR&ED, IRAP, Mitacs, IDEaS) are available regardless of province.
Can a non-Canadian company access Canadian AI grants? No for most programs. SR&ED requires the claimant to be a Canadian tax-paying corporation. IRAP requires an incorporated Canadian SME. Scale AI and DIGITAL require Canadian company membership. Foreign companies can access some funding indirectly by establishing a Canadian subsidiary — but the subsidiary must have genuine Canadian operations, employees, and IP activity; a shell entity does not qualify.
What's Changed in 2026
- SR&ED expenditure limit raised to $6M (Budget 2025): The enhanced-rate CCPC expenditure ceiling increased directly from $3M to $6M for tax years beginning after 2024. The maximum enhanced annual credit is now $2.1 million per year — a 50% increase in the maximum refundable amount. AI companies spending $4–6M annually on R&D are the primary beneficiaries. Source: Department of Finance Canada — Budget 2025
- Quebec renamed CRIC (previously RD Innovation / CQRI): Quebec's provincial R&D credit was renamed CRIC (Research, Innovation and Commercialization) under Budget 2026-2027 and expanded to include commercialization-phase expenditures not previously eligible. AI companies in Quebec should verify which of their activities fall under the expanded CRIC scope. Source: Ministère des Finances Québec — CRIC
- RAII continuous intake confirmed through 2028: PrairiesCan confirmed RAII accepts continuous applications with no quarterly windows through its December 31, 2028 program end date. First-year approvals funded 7 projects averaging $1.07M each from a $33.8M pool. Source: PrairiesCan — RAII
- Scale AI entered its second mandate (2024–2029): Scale AI secured renewed federal funding for its second 5-year mandate with a focus on expanding AI adoption in healthcare, agriculture, and financial services. Industry-Led Projects and the Acceleration Program continue under the renewed mandate. Source: Scale AI — scaleai.ca
- IDEaS AI-specific challenges increased in volume (2025–2026): DND posted significantly more AI-specific challenges in the 2025–2026 period — including challenges targeting large language model applications for defence intelligence analysis, autonomous systems for logistics, and AI-assisted threat detection. Companies should monitor CanadaBuys weekly for new AI challenge postings. Source: Department of National Defence — IDEaS
- DIGITAL active calls for 2026 cycle open: The Digital Technology Supercluster opened AO 10.1, 10.2, and 10.3 for its 2026 program year, targeting AI in precision health, climate-smart infrastructure, and industrial transformation. Companies must be DIGITAL members to access calls; membership is open to Canadian companies. Source: DIGITAL — digitalsupercluster.ca