Author Archive

Alberta SR&ED is here!

April 24, 2008

The Alberta budget was released on April 22, 2008 and introduced the long awaited provincial Scientific Research and Experimental Development (SR&ED) refundable tax credit.  The program will initially provide $60 million towards building knowledge-based industry, growing over time as businesses undertake more research and development.

 

This refundable credit is worth 10% of eligible expenditures on research and development starting on January 1, 2009.  Eligible expenditures up to $4 million will receive a maximum annual credit of $400,000.

The Alberta SR&ED investment tax credit is refundable for all companies. This will be of special benefit to start-up and early stage companies, because they will still be able to receive the credit even though they may not be earning enough income to pay income taxes.

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Startup Money Tricks #2: Work the Grant Structure

March 26, 2008

Every year there are billions of dollars provided as an incentive for companies in the startup phase and on an ongoing basis.  The rules are complex and confusing which means that many companies (roughly 80%) do not claim grants, funding and refundable investment tax credits that they are entitled to.  Here are some programs that you should consider . . . (some perseverance and tenacity is required!) 

1.      NRC Industrial Research Assistance Program (NRC-IRAP)

2.      Scientific Research and Experimental Development Program (SR&ED)

3.      Natural Sciences and Engineering Research of Canada (NSERC)

4.      National Research Council (NRC)

5.      Alberta Advanced Education and Technology

The NRC Industrial Research Assistance Program (NRC-IRAP) 

This program provides a range of both technical and business oriented advisory services along with potential financial support to growth-oriented Canadian small – and medium-sized enterprises (fewer than 500 employees). Working directly with these clients, NRC-IRAP supports innovative research and development and commercialization of new products and services including: 

  • Technology Expertise and Advisory Services
  • Financial Assistance for R&D activities
  • Networking
  • Partnerships

For Information on IRAP, call 1-877-994-4727

Scientific Research and Experimental Development Program (SR&ED)

The Scientific Research and Experimental Development (SR&ED) program is a federal tax incentive program to encourage Canadian businesses of all sizes and in all sectors to conduct research and development (R&D) in Canada that will lead to new, improved, or technologically advanced products or processes. The SR&ED program is the largest single source of federal government support for industrial research and development.

Claimants can apply for SR&ED investment tax credits for expenditures such as wages, materials, machinery, equipment, some overhead, and SR&ED contracts.

Under the Federal program, Canadian Controlled Private Corporations (CCPC’s) receive a refundable Investment Tax Credit (ITC) of 35% on $2 million of expenditures and 20% on expenditures over the $2 million benchmark. Canadian Public Corporations earn a 20% non-refundable ITC on qualified expenditures which can be used to reduce taxes payable.  Proprietorship, partnership or certain trusts earn a 20% partially refundable ITC to reduce taxes payable.

The Alberta government is set to introduce a provincial SR&ED program with a refundable 10% investment credit on all eligible expenditures.  Details will be provided in the provincial budget to be passed down in April 2008 (or thereabouts).

For more information visit www.g9Consulting.com 

Natural Sciences and Engineering Research Council of Canada (NSERC) 

Under the Collaborative Research and Development (CRD) Grants program direct project costs are shared by the industrial partner(s) and NSERC in an amount equal to, or greater than, the amount requested from NSERC.

Projects may range from one year to five years in duration, but most awards are for two or three years. CRD projects are monitored closely. Annual progress reports are normally required from the grantee. The industrial partner will be asked to provide comments on the project’s progress.

For more information call 613-995-1111 or email rpp@nserc.ca

 The National Research Council (NRC)

The NRC functions under the auspices of the National Academy of Sciences (NAS), the National Academy of Engineering (NAE), and the Institute of Medicine (IOM). The four organizations are collectively referred to as the National Academies.

The core services involve collecting, analyzing, and sharing information and knowledge. The independence of the institution, combined with its unique ability to convene experts, allows it to be responsive to a host of requests.

Free Scientific Information is available from this organization that publishes more than 200 reports and related publications each year, the institution is one of the largest providers of free scientific and technical information in the world.  Most of it is now on the Web at www.nap.edu.   

NRC also conducts collaborative and fee-for-service research in facilities and offices across Canada.

Western Economic Diversification Canada (WD)

 WD offers numerous funding and assistance programs through the Western Diversification Program.  Through the Loan and Investment Program, WD contributes to a loan loss reserve, which offsets a portion of the risk financial institutions experience when lending to small businesses. http://www.wd.gc.ca/259_ENG_ASP.asp 

Alberta Advanced Education and Technology (AAET)

Alberta Advanced Education and Technology provides leadership and strategic investments in research and science and technology initiatives that are undertaken in the following priority areas: energy, ICT, nanotechnology, and the life sciences.Research equipment in these areas can be applied for via the Alberta Science and Research Investments Program (ASRIP) or the Small Equipment Grants Program (SEGP).

Alberta Advanced Education and Technology manages a number of programs that provide various forms of research funding.

The Ingenuity Industry Associates program addresses the increasing research personnel needs of Alberta industry. Through this program, Alberta companies are able to recruit recent Master’s and PhD graduates to conduct research that benefits the organization.

Check out these programs, and share your experience if you have had success with others not mentioned here!