Posts tagged SR+ED
Today, during Ontario’s Civic Holiday, I finally got around to filling out Deloitte Technology Fast 50™ CEO Survey. There was an interesting question that sparked a thread that I’ve been thinking about lately:
“Specifically, do you think the SR&ED tax credit program is pretty good as is, or needs improvement? If it needs big changes, what would be the first change you would make?”
For those of you who don’t know what the SR&ED program is, go learn more because it can save your business tons of cash over time and help you finance your business with non-dilutive government assistance.
For those of you running (or have previously run) early-stage stage startups, here are my thoughts: Currently SR&ED will refund a portion of a startup’s R&D costs based on expenses incurred during the previous year – some of those earliest expenses claimed were incurred 18 months prior to the claim. For startups, this is an eternity. Today, startups can grow and die violently before they get their first SR&ED claim, which could have helped them to pay one more employee, solve one more problem or help one more customer.
The Canadian government should consider modifying the SR&ED program to include a faster-reimbursement timeframe for startups (making less than $1,000,000 in revenue per year). For example, this could mean making claims quarterly and being reimbursed within 60-90 days – this would massively improve startup financing in the short-term. A modification, as requested, would help startups build value and growth potential more quickly and help the overall competitiveness of the Canadian technology sector.
Will anyone help to stand behind an initiative to get the Canadian government to improve the SR&ED program for startups? Join the conversation in the comments below.
I want to draw your attention to a blog post that I wrote on the BlackBerry Partners Fund website a few months ago. In times of recession, when cash is tight and purchase orders are scarce, understanding how and where to receive financing becomes of paramount important.
For additional details, please refer to the full article.
Here are some of the highlights:
- Apply for IRAP funding (provided by the NRC)
- Apply for SR+ED tax claims through the Scientific Research and Experimental Development (SR&ED) Tax Incentive Program
- Funding Source: The Investment Accelerator Fund (IAF). Through investment of up to $500K, the IAF helps launch high potential technology ventures.
- Funding Source: MaRS Discover District has a number of services that can help entrepreneurs. They have funding from the Ministry of Research and Innovation for business projects and investments of up to $500,000 in seed capital.
- Ontario Centre of Excellence for Communications (OCE) and Information Technology helps startups by co-investing in the research and development of leading-edge, industrially relevant, technologies through partnerships at universities, and moving the results into the marketplace, through existing companies or new, spin-off enterprises.
If you are a mobile start up, please feel free to apply for Jump Start Financing at the BlackBerry Partners Fund, which can invest up to $500K USD into innovative start ups.