Resonant Consulting » Featured Items

The government is funding your development. Are you claiming the refund?

admin — Thu, 29 Oct 2009 08:59:51 +0000

R&D and innovation are key to growth, both for Canada’s economy and for our individual businesses. Investing in development carries risk in that the costs are immediate, yet the potential returns are delayed. The dilemma is that when growth is most sorely needed, funding for development can be difficult to find. Fortunately, even during the lean times, Canada is funding your growth. Unfortunately, many do not take advantage.

Development and innovation are organic processes. You can’t fund successful innovation alone. Each success is built upon the shoulders of countless failed experiments. SR&ED, Canada’s $4 Billion per year incentive program, is targeted at companies that perform either Scientific Research or Experimental Development, regardless of success.

More information can be found in our SR&ED section.

Practically every company that has staff working on development or manufacturing performs work that is eligible. Many technology companies receive a cash refund every year from CRA equal to 30-50% of their entire development budget. However, many companies don’t know about the program or underestimate their eligibility and choose not to file.

SR&ED doesn’t fund only successful or revolutionary innovation. In fact, innovation or novelty aren’t even required. The program was founded in the 1980s as a way to provide incentive for doing development work in Canada. There is no application or approval process; the eligible costs are claimed on your corporate T2.

If you perform the work, you can bank on the refund every year. Very likely your company has already been earning this incentive. Have you claimed it? It’s easy to start, and you can retroactively claim for last year as well.

Related Information:

SR&ED is Canada’s Largest Technology Incentive Program

admin — Thu, 29 Oct 2009 01:05:44 +0000

Technology companies across Canada regularly perform work which qualifies for funding from the $4 Billion per year SR&ED program. Bleeding edge technological advancement is not required. Much of what your company might consider ‘routine development’ is actually eligible.

While SR&ED eligibility is not limited to the information technology sector (development in other sectors, such as GreenTech, Medical, Manufacturing, and Telecom is also eligible), frequently IT companies see the greatest portion of their work eligible for SR&ED credits. It is not uncommon for an IT company to receive an annual refund cheque equal to 30-50% of their entire development operating budget.

IT companies performing the following types of work in Canada are elligible for significant funding from the SR&ED program:

development of new software products
integration of sub-components into a system
the porting or retrofitting of legacy software
New Media development
development of software as services
web development
Search Engine Optimization and web analytics
development of device drivers or firmware
hardware development
etc…

As you can see, nearly every type of development can qualify for SR&ED funding. Whether you build video games, websites, corporate data reports engines, or iPhone apps, you are doing work for which Canada is paying you.

Many incorrectly assume that they won’t qualify for a refund due to some common SR&ED Myths. Don’t be fooled into thinking that your work won’t qualify, that the rewards aren’t worth the effort, or that your lack of taxes owing will prevent you from getting a sizable refund cheque each year.

Even if you do choose to file, doing so yourself can be a lengthy and complicated process where your best technical resources are tied up in acquiring the refund you’ve already earned. Quite often, those who do file for themselves have trouble understanding the nuances of the tax law, and wind up significantly underestimating the portion of their work that is eligible.

With The Resonant Advantage, you can stay focused on growing your business while our SR&ED experts maximize your refund. As a bonus, first time filers can retroactively file for the previous year’s SR&ED and get two cheques their first year. There is a deadline to file before the SR&ED credits you’ve earned permanently expire, so contact us today to get started!

Related Information:

Shred Your Development Costs

admin — Thu, 29 Oct 2009 00:57:40 +0000

Even if you owe no taxes, with the SR&ED Program, you can cut your development expenses by 30-50%. Of the costs related to eligible work, a Canadian Controlled Private Corporation can expect to receive an annual refund cheque amounting to the sum of:

Nearly 70% of salaries
Over 40% of contractor fees
Over 20% of equipment costs

Canada provides over $4 Billion per year in incentives to keep foreign and domestic businesses working in Canada. Nearly every company which performs development or manufacturing qualifies for significant annual tax credits. For most corporations those credits are refunded in cash.

Many companies underestimate their eligibility, mistakenly assume that their tax situation does not qualify for a cash refund, or worry that the filing process is too daunting to be worthwhile. These companies have fallen prey to common SR&ED Myths and are missing out on a reliable annual revenue stream.

With The Resonant Advantage, the process is simple; our SR&ED experts do all the work. The first claim usually requires only a handful of hours on the part of the client. Subsequent claims are even further streamlined, so that your SR&ED refund seems almost to surprise you every year. As a bonus, first-time filers can retroactively claim for the previous year (don’t miss the deadline!). Very likely there are two cheques waiting for you to claim.

What about the risk? Even the most risk-averse see SR&ED as a sure-thing. There is no approval process, the funds do not run out. Your annual refund is guaranteed for as long as you do the eligible work. Major financial institutions will even lend against the SR&ED credits accrued mid-year. Finally, Resonant’s fees are entirely contingent upon your successful claim. With a 100% filing success rate, we are confident in your successful claim, and defer our percentage-based fee until after you receive your refund cheque.

Related Information: