Updated August 2026 · Verified against Canada Revenue Agency guidelines
▲ Growing ✓ First-Timer Friendly Tax Credit Offset Est. 1986
Tax Credit Federal Active

Scientific Research and Experimental Development (SR&ED)

Canada Revenue Agency
Maximum Credit
Up to 35% refundable ITC (enhanced rate for CCPCs on first...
Ongoing
Visit Official Program →
Difficulty
Hard
Payment
Tax Credit Offset
Trend
Growing
First-Timers
Friendly ✓
Credit rate
35%
Scientific Research and Experimental Development (SR&ED) provides Up to 35% refundable ITC (enhanced rate for CCPCs on first $6M); 15% non-refundable for others. Combined federal+provincial can exceed 50%. The Scientific Research and Experimental Development (SR&ED) tax incentives encourage businesses to conduct research and development in Canada. Applications are accepted on an ongoing basis. Approval odds: ~90% (GrantCompass analysis)
Eligibility check

Can you claim this credit?

Get your instant eligibility verdict plus a head start on the application. Free, no account needed.

We use this program’s real eligibility rules. 4 short questions follow.

Want your full match picture across 850+ programs? Take the 2-minute quiz →

Eligibility & Details

What this program funds and who can apply

Free

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
Provinces
All Provinces
Industries
All
Business Stage
Startup Growth Expansion

Quick Assessment

Difficulty
Hard
Competition
Low
First-Timer
Friendly

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

Competition
Low
Deadline
Ongoing
Approval
Entitlement
Approval Rate
~90%
Accessibility
--/5
Competition
--/5
Premium See your real odds on this program — and exactly what it takes to win it.

How to claim

Insider tips, common pitfalls, and what successful applicants look like

Premium
Insider Tip

Submit 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.

Premium See what trips up most applicants for this program — and how to avoid it.

Rejection Pitfalls 8

  • Work described as routine engineering or standard practice rather than addressing a genuine technological uncertainty
+7 more pitfalls
Premium See the most common reasons applications get rejected — before you submit yours.

Success Profile

Premium See what successful applicants for this program actually look like.

Evaluation Criteria

Premium See exactly what the program administrators check — so you know where to focus.
Premium All 8 pitfalls, the checklist and the reviewer notes are in the Playbook below. See what it includes ↓
What's in this Playbook

Everything you need to claim Scientific Research and Experimental Devel...

Not a marketing summary. The actual checklist, intel, and stack strategy reviewers look for.

Premium covers every program, plus the workspace that walks you through each application.
Get Premium — $39/mo Just this one program? Unlock the Playbook alone — $19

Application Playbook

Step-by-step process, required documents, and expenses

Premium 7 steps 8 docs

Application Steps

1 Document Throughout the Year Maintain contemporaneous technical records as you perform R&D: lab notebooks, design documents, test logs, meeting minutes, emails. Track employee time allocated to SR&ED projects weekly or biweekly. This is the most critical step — retroactive documentation is the #1 audit trigger.

Required Documents 8

✓ Form T661, SR&ED Expenditures Claim (current version)
✓ Form T2SCH31 (Investment Tax Credit - Corporations) or Form T2038(IND) (Investment Tax Credit - Individuals) to claim the ITC

Eligible Expenses 6

Ineligible Expenses 7

Claim timing

Deadline Notes

Ineligible Organizations

Premium Get the step-by-step application guide — documents, timeline, and what to prepare.

Funding Stack Strategy

Compatible programs, clawback risk, and combined funding potential

Premium 7 partners

Compatible Programs

NRC IRAP Provincial R&D tax credits CanExport Innovation MITACS NSERC BDC loans/financing Ontario ORDTC/OITC, Quebec R&D Credit, BC SRITC, Alberta IEG
Combined Funding Potential See your total funding potential

Clawback Risk

Low Risk
Premium See which programs combine with this one — and how much more you could get.

How Scientific Research and Experimental Devel... Compares

Side-by-side with similar programs

Free
Program Amount Difficulty Payment Deadline
Scientific Research and Experimental ... Up to 35% refundable ITC Hard Tax Credit Offset Ongoing
NRC IRAP Clean Technology Program $100,000–$500,000 Hard Mixed (Advance + Reimb.) Ongoing
CanExport Innovation Up to $37,500 Moderate Reimbursement Upcoming — the...
Mitacs Accelerate $15,000 per internship unit Easy Advance Payment Ongoing
NSERC College and Community Social In... Up to $120,000 Hard Advance Payment February 25 annually at...

Related Programs

Other programs you might be eligible for

Free
Grant

Grant for Nunavut Employers (GNE)

Two-thirds of eligible training costs per trainee, to a... · Territorial
 Grant

Incoming Buyer Program (IBP) — Manitoba

Up to $5,000 per project (50% of eligible expenses) · Provincial
 Loan

Indigenous Business Corporation (IBC) — First Nations Business Loans

Varies. Development lending sized to the project, with no... · Private

Frequently Asked Questions

Quick answers to the questions founders most often ask about Scientific Research and Experimental Devel...

Free
Can sole proprietors apply for SR&ED?
No — SR&ED requires filing corporate taxes. Sole proprietors must incorporate to claim. Only incorporated businesses (including CCPCs) qualify for the refundable 35% rate.
What's the realistic claim size for a small dev team?
A CCPC with 5 developers spending 50% time on R&D (combined salary ~$500K) typically gets $175K-$250K in federal+provincial credits. Average small business claim: ~$102K.
When must I file my claim?
The SR&ED reporting deadline is 12 months after the filing due date of your return: 18 months after the tax year end for a corporation, 17.5 months for an individual. An expenditure not reported by then earns nothing. Filing with the T2 return processes fastest.
Why do most claims get rejected?
Weak technical narrative in Form T661 — failing to explain technological uncertainty, systematic investigation, and advancement. Vague descriptions are the top reason.
Can I stack SR&ED with provincial credits?
Yes — all provinces except PEI offer additional credits (3.5-30%) that stack on federal SR&ED. For example, Ontario adds 12.5% on top of federal rates.
Do I have to tell the CRA who prepared my claim?
Yes. Part 9 of Form T661 asks whether a claim preparer was engaged in any aspect of preparing the claim, and requires prescribed information about each preparer that accepted payment. A penalty of $1,000 may be assessed for each claim where that information is missing, incomplete or inaccurate.

Browse More Funding

Federal Grants Explore All Programs Take the Quiz