The Scientific Research and Experimental Development (SR&ED) tax credit is a government incentive available to a wide range of companies in the design and manufacturing sector. This tax credit enables qualifying companies to obtain a deduction based on income expenditures and costs associated with research and development activities.
SR&ED credits can reach a rate of 35% for Canadian Controlled Private Corporations (CCPCs) and 15% for other corporations. Provincial SR&ED tax credits are also available and rates and conditions vary by Province.
The credit is primarily used to offset Corporate Taxes, but for CCPCs, it is also reimbursable