Scientific Research and Experimental Development (SR&ED)
Compared with the 242 other application forms we have read
- The heaviest thing to produce is technical documentation. 14 ask for that.
- The work here is mostly writing long answers. For 59%, the job is assembling documents instead.
- What does not disqualify you: No evidence filed upfront. 119 record an exemption like this.
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Eligibility & Details
What this program funds and who can apply
Program Description
The Scientific Research and Experimental Development (SR&ED) tax incentives encourage businesses to conduct research and development in Canada. Corporations, individuals, trusts and partnerships that do eligible work can claim a deduction against income and earn an investment tax credit (ITC) - a basic rate of 15%, or a refundable enhanced rate of 35% up to an expenditure limit for most Canadian-controlled private corporations and, for tax years beginning after December 15, 2024, eligible Canadian public corporations.
Eligibility Requirements
- Canadian business conducting qualifying R&D activities (technological uncertainty, systematic investigation, technological advancement)
- Must be filing Canadian corporate or business taxes and reporting income in Canada
- R&D work performed in Canada
- Claim reported by the SR&ED reporting deadline: 12 months after the filing due date of the return, which is 18 months after the tax year end for corporations and 17.5 months for individuals (no extensions)
- Contemporaneous technical documentation maintained throughout the R&D project
- For the enhanced 35% refundable rate: must be a Canadian-Controlled Private Corporation (CCPC) with taxable income under $800K and taxable capital under $75M (enhanced expenditure limit phases out between $15M and $75M taxable capital — Budget 2025)
- Excluded work cannot be claimed: market research or sales promotion, quality control or routine testing of materials, devices, products or processes, research in the social sciences or the humanities, prospecting, exploring or drilling for, or producing, minerals, petroleum or natural gas, the commercial production of a new or improved material, device or product or the commercial use of a new or improved process, style changes, routine data collection, training, on-the-job learning, hiring experts to apply what they already know, and purchasing proprietary knowledge
Quick Assessment
Funding Details
- Amount
- Up to 35% refundable ITC (enhanced rate for CCPCs on first $6M); 15% non-refundable for others. Combined federal+provincial can exceed 50%.
- Type
- Tax Credit
- Level
- Federal
- Credit rate
- Up to 35% of eligible costs
- Deadline
- Ongoing
Program Scorecard
Competition, effort, and approval at a glance
Moderate — standard application process
Low competition — good odds of approval
Complex — detailed documentation needed
How to claim
Insider tips, common pitfalls, and what successful applicants look like
Insider TipSubmit your SR&ED claim together with your income tax return and at least 90 days before the reporting deadline so the CRA has time for an initial review and can ask for corrections before the deadline.
Rejection Pitfalls 8
- Work described as routine engineering or standard practice rather than addressing a genuine technological uncertainty
Success Profile
Evaluation Criteria
How Canada Revenue Agency judges your application
What the reviewer scores, what gets applications rejected, and what to write.
Distilled from 4 source documents on canada.ca, condensed into one brief. Sources as of 2026-09-01.
4 sources
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What Canada Revenue Agency favours
Advance scientific knowledge or achieve technological advancement◦
“The work must be conducted for the advancement of scientific knowledge or for the purpose of achieving a technological advancement”
The form
Project identification
- Part 2, Section APart 2, Section A – Project identificationtableno limit
Section B – project narratives
- Line 242Line 242 – Scientific or technological uncertaintywritten answer · 350 words
242 What scientific or technological uncertainty did you attempt to overcome? (Maximum 350 words)
- Line 244Line 244 – Work performed in the tax year (systematic investigation or search)written answer · 700 words
244 What work did you perform in the tax year to overcome the scientific or technological uncertainty described in line 242? (Summarize the systematic investigation or search) (Maximum 700 words)
- Line 246Line 246 – Scientific or technological advancementwritten answer · 350 words
Section C – people and evidence
- 5Section C – Who prepared the responses for Section B?checkboxno limit
- 6Section C – Key employeestableno limit
- 7Section C – Supporting evidencecheckboxesno limit
Checklist, preparer and certification
- Part 8Part 8 – Claim checklistcheckboxno limit
- Part 9Part 9 – Claim preparer informationselection + writtenno limit
- Part 10Part 10 – Certificationshort answerno limit
bar = length the funder allows, from its stated limits
Judged against
- 1
Is this real scientific advancement?
Show them Describe the uncertainty and the knowledge base that existed before the work.◦
In the funder’s words · 1
- The work must be conducted for the advancement of scientific knowledge or for the purpose of achieving a technological advancement
- 2
Was the investigation systematic?
What to show, and the funder’s 2 criteria behind it in Premium
- 3
What new knowledge did you gain?
What to show, and the funder’s 1 criterion behind it in Premium
- 4
Can you prove the work happened?
What to show them in Premium
Where applicants fail
“Filing a form or schedule with missing information, or using a previous version of Form T661 to file a current-year claim, may delay the processing of your claim, and some or all of your expenditures may be denied if the relevant prescribed information is not included on the form by the SR&ED reporting deadline.”
“If you do not report an expenditure on Form T661 by the SR&ED reporting deadline, you will not be entitled to receive the SR&ED incentives for that expenditure.”
Premium · the rest of this brief
See all 6 rules that can reject you and every criterion you are judged on. Then we draft your application for you.
3 more rules that can reject you · 3 more criteria · 5 more prompts
Do you pass?
Each one can rule you out. Tick the ones you meet.
You
Eligible claimant type
Claimant types: corporations, individuals, trusts, partnerships (S2 filing instructions)
Your business
Wages paid within 180 days
Salary or wages incurred but not paid within 180 days of the tax year-end are deemed not incurred in the tax year
Contract payment 80% rule
Only 80% of arm's-length contract and third-party payments count as qualified expenditures; non-arm's-length contract SR&ED does not qualify for the ITC
1 thing this funder says you do NOT need, in Premium.
Documents to attach
Ticks are kept on this device.
The money
Prescribed proxy amount55% of salary base
The PPA is 55% of the salary base (line 818).
Contract payment share80% arm's-length and third-party payments
only 80% of arm's-length contract and third-party payments count as qualified expenditures; non-arm's-length contract SR&ED does not qualify for the ITC
StackingOther government R&D funding may still qualify
If you receive other government funding for research and development (R&D), your work may still be eligible for SR&ED tax incentives.
Costs before approvalMiss T661 deadline loses SR&ED incentives
If you do not report an expenditure on Form T661 by the SR&ED reporting deadline, you will not be entitled to receive the SR&ED incentives for that expenditure.
What it pays for · 5
- The salary or wages that you include on lines 300 to 309 must only be for employees who are directly engaged in SR&ED.
- Enter the cost of materials consumed in performing your SR&ED. You can claim the cost of materials that are destroyed or that are rendered virtually valueless as a result of performing SR&ED.
- Materials transformed are described as materials that have been incorporated into other materials or products that have some value to either the claimant or another party.
- Under the traditional method, you can include the portion of other salary or wages of employees who directly undertake, supervise, or support the performing of SR&ED but who are not directly engaged in the SR&ED itself, at line 360.
- The PPA is 55% of the salary base (line 818).
What it does not pay for · 4
- Do not include in salary or wages the employer's share of the related benefits.
- Do not include expenditures for items such as cleaning supplies, discs used in computers, filter papers, lubricants, solvents, acids and test tubes (or other similar glassware or plastic ware) used in SR&ED. Such items are supplies and are considered overhead expenditures. Do not include measuring appliances.
- Market research or sales promotion; Quality control or routine testing of materials, devices, products, or processes; Research in the social sciences or the humanities; Prospecting, exploring or drilling for, or producing, minerals, petroleum or natural gas; The commercial production of a new or improved material, device, or product, or the commercial use of a new or improved process; Style changes; Routine data collection
- interest and other financing costs; a due or fee for membership in a scientific or technical society or organization; legal or accounting fees; and expenditures for the acquisition of used equipment.
From application to money
- File the claimFile T661 within 12 months of due date
- CRA reviewCRA may select claim for review
- Retain recordsRetain supporting records for possible review
In the funder’s words · 3
- File the claim
- File Form T661 with your income tax return through approved tax software. (within 12 months of the filing due date of your income tax return)
- CRA review
- CRA may select the claim for review.
- Retain records
- You are required to retain supporting records in the event of a review.
Quoted lines are word for word from the source documents; lines marked ◦ are our reading of them.
Everything you need to claim Scientific Research and Experimental Devel...
Not a marketing summary. The actual checklist, intel, and stack strategy reviewers look for.
- 8 rejection pitfalls reviewers flag — so you catch them first
- 8-document checklist with what each reviewer is actually checking
- Your Application Game Plan — the print-ready PDF the preview below describes
- 7-step application timeline with prep hours per step
- Insider tip from program officers on what separates winners
- 7-program stacking strategy to combine with compatible funding
- Success profile + evaluation criteria — exactly what the program administrators check
Application Playbook
Step-by-step process, required documents, and expenses
Application Steps
Required Documents 8
Eligible Expenses 6
Ineligible Expenses 7
Claim timing
Deadline Notes
Ineligible Organizations
Funding Stack Strategy
Compatible programs, clawback risk, and combined funding potential
Compatible Programs
Clawback Risk
Low RiskHow Scientific Research and Experimental Devel... Compares
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