{"id":9175,"date":"2026-11-09T16:45:30","date_gmt":"2026-11-09T15:45:30","guid":{"rendered":"https:\/\/leyton.com\/ca\/?post_type=article&p=9175"},"modified":"2026-11-09T16:45:31","modified_gmt":"2026-11-09T15:45:31","slug":"budget-2026-widens-sred-more-of-the-cost-of-bringing-your-innovation-to-market-could-now-be-covered","status":"publish","type":"article","link":"https:\/\/leyton.com\/ca\/en\/insights\/articles\/budget-2026-widens-sred-more-of-the-cost-of-bringing-your-innovation-to-market-could-now-be-covered\/","title":{"rendered":"Budget 2026 widens SR&ED: more of the cost of bringing your innovation to market could now be covered"},"content":{"rendered":"\t\t
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Canada\u2019s federal budget, released on November 5, 2026, makes the SR&ED tax incentive broader. If your company develops new products, <\/span>processes<\/span> or software, more of what it spends to get that innovation to market could now earn tax support. <\/span><\/span><\/p>

And if you have never claimed SR&ED, this is a good moment to take another look.<\/span><\/span>\u00a0<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t

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The short version <\/h2>\t\t\t\t<\/div>\n\t\t\t\t
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  • SR&ED would cover two new types of cost: regulatory and certification testing, and the cost of protecting your intellectual property (IP).<\/span>\u00a0<\/span><\/li><\/ul>
    • The changes are proposed for tax years that begin on or after November 5, 2026.<\/span>\u00a0<\/span><\/li><\/ul>
      • The credit rates are unchanged: 35% for certain small and medium-sized corporations, 15% for everyone else.<\/span>\u00a0<\/span><\/li><\/ul>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t
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        What is new <\/h2>\t\t\t\t<\/div>\n\t\t\t\t
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        Until now, SR&ED has centred on the research and development itself, and work beyond the experimental stage is <\/span>generally left<\/span> out. Budget 2026 proposes to follow your project further down the road to market.<\/span><\/span>\u00a0<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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        1. Regulatory and certification testing<\/h3>\t\t\t\t<\/div>\n\t\t\t\t
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        Tests, technological validations and studies carried out to meet the regulatory requirements for the first approval or certification of a product or process could qualify, as long as they are directly tied to a project that already qualifies for SR&ED. Picture a company that has developed a new device and must run tests to earn the certification it needs before it can sell.<\/span><\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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        2. Protecting your IP<\/h3>\t\t\t\t<\/div>\n\t\t\t\t
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        The cost of registering and maintaining protection for IP created in an eligible project could qualify too. That includes patents, certificates of supplementary protection, plant breeders\u2019 rights and copyrighted software, in Canada or abroad. It covers preparing and filing the application and the periodic fees that keep your rights in force. Legal costs to enforce your rights, such as litigation, are not included. If you file abroad, fees paid to the foreign IP office qualify, but supporting work such as preparing the application counts only if it is done in Canada. And if you later sell the IP, the tax benefit can be recaptured.<\/span>\u00a0<\/span><\/p>

        The government estimates this expansion at $930 million of support over five years<\/strong>, and the Canada Revenue Agency (CRA) plans to publish guidance by sector on what counts as a commercialisation expense.<\/span>\u00a0<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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        What stays the same <\/h2>\t\t\t\t<\/div>\n\t\t\t\t
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        SR&ED costs <\/span>remain<\/span> fully deductible in the year you incur them, and they also earn an investment tax credit. Eligible costs are still the familiar ones: salaries and wages, materials, contracting, overhead, and machinery and equipment. The work itself must still be a systematic investigation in science or technology, carried out through experiment or analysis.<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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        Why so many businesses miss out <\/h2>\t\t\t\t<\/div>\n\t\t\t\t
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        SR&ED is not only for laboratories or large corporations. A manufacturer improving a process, a software team building something standard methods can\u2019t deliver, a food or agri-business developing a new product: if you are solving a technical problem where the answer is not obvious, you may have eligible work. Many companies never claim because they assume their work is just part of doing business, or that the paperwork will be too heavy. Clear records and a well-told technical story make a real difference, and that is where we can help.<\/span>\u00a0<\/span><\/p>

        This budget builds on last year\u2019s improvements, when the government expanded access to the enhanced credit, restored support for capital expenditures and raised the annual limit on which the enhanced credit can be earned to $6 million. <\/span><\/p>

        The direction is consistent: Canada wants companies to innovate here, and it is willing to help pay for it.<\/strong><\/span>\u00a0<\/strong><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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        Other support worth a look <\/h2>\t\t\t\t<\/div>\n\t\t\t\t
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        • Productivity Mega Deduction:<\/span><\/b> an immediate write-off for a much wider range of capital assets acquired on or after September 15, 2026.<\/span>\u00a0<\/span><\/li><\/ul>
          • Clean technology and clean electricity tax credits:<\/span><\/b> extended to property available for use before 2041.<\/span>\u00a0<\/span><\/li><\/ul>
            • Canada Growth Incentive:<\/span><\/b> a capital gains exemption of up to $15 million for qualifying shares of Canadian-controlled private corporations.<\/span>\u00a0<\/span><\/li><\/ul>
              • Funding programs:<\/span><\/b> $1 billion more for the Strategic Response Fund from 2028-29, renewed IRAP Clean Technology funding ($298 million) and extra support for tariff-affected small and medium-sized businesses.<\/span>\u00a0<\/span><\/li><\/ul>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t
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                What to do now <\/h2>\t\t\t\t<\/div>\n\t\t\t\t
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                1. Start capturing the right records.<\/span><\/b> Keep time records, test and certification reports, and IP filing invoices linked to each development project.<\/span>\u00a0<\/span><\/li>
                2. Look at your next tax year.<\/span><\/b> If it begins on or after November 5, 2026, these proposed changes could apply to it.<\/span>\u00a0<\/span><\/li>
                3. Remember these are proposals.<\/span><\/b> Legislation and CRA guidance are still to come. We are tracking both and will keep you posted.<\/span>\u00a0<\/span><\/li><\/ol>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t
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                  \u00a0<\/p>

                  This article is general information based on measures proposed in Budget 2026 (Department of Finance Canada, budget.canada.ca, pp. 117 and 402\u2013403). Proposals may change before they become law. It is not tax advice; please speak to an adviser about your situation.<\/span><\/span>\u00a0<\/span><\/em><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

                  Canada\u2019s federal budget, released on November 5, 2026, makes the SR&ED tax incentive broader. If your company develops new products, processes or software, more of what it spends to get that innovation to market could now earn tax support. And if you have never claimed SR&ED, this is a good moment to take another look. […]<\/p>\n","protected":false},"author":72,"featured_media":9177,"menu_order":0,"comment_status":"open","ping_status":"open","template":"","format":"standard","meta":{"_acf_changed":false,"_leyton_l4m_sync":false,"footnotes":""},"categories":[110,336],"tags":[115],"expertise":[399036,774],"class_list":["post-9175","article","type-article","status-publish","format-standard","has-post-thumbnail","hentry","category-sred","category-sred-3","tag-sred-en","expertise-rd-tax-credits","expertise-sred-tax-credits"],"acf":[],"yoast_head":"\nBudget 2026 widens SR&ED: more of the cost of bringing your innovation to market could now be covered - Leyton Canada<\/title>\n<meta name=\"description\" content=\"Discover how Canada's Budget 2026 expands SR&ED to cover IP protection, regulatory testing, and commercialization costs.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/leyton.com\/ca\/en\/insights\/articles\/budget-2026-widens-sred-more-of-the-cost-of-bringing-your-innovation-to-market-could-now-be-covered\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Budget 2026 widens SR&ED: more of the cost of bringing your innovation to market could now be covered\" \/>\n<meta property=\"og:description\" content=\"Discover how Canada's Budget 2026 expands SR&ED to cover IP protection, regulatory testing, and commercialization costs.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/leyton.com\/ca\/en\/insights\/articles\/budget-2026-widens-sred-more-of-the-cost-of-bringing-your-innovation-to-market-could-now-be-covered\/\" \/>\n<meta property=\"og:site_name\" content=\"Leyton\" \/>\n<meta property=\"article:modified_time\" content=\"2026-11-09T15:45:31+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/leyton.com\/wp-content\/blogs.dir\/3\/files\/2026\/11\/Canada-Website-inside-pictures-2026-11-09T094018.256.webp\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"655\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/leyton.com\\\/ca\\\/en\\\/insights\\\/articles\\\/budget-2026-widens-sred-more-of-the-cost-of-bringing-your-innovation-to-market-could-now-be-covered\\\/\",\"url\":\"https:\\\/\\\/leyton.com\\\/ca\\\/en\\\/insights\\\/articles\\\/budget-2026-widens-sred-more-of-the-cost-of-bringing-your-innovation-to-market-could-now-be-covered\\\/\",\"name\":\"Budget 2026 widens SR&ED: more of the cost of bringing your innovation to market could now be covered - 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