Author: Bikram Johal, President of Banhall Consulting ltd.
You have investigated the SR&ED program, and you find out that your business meets the three criteria to qualify and answered yes to the five questions. The next step is, what are the documents you will need to file your SR&ED claim?
If you are planning to make a SR&ED claim for the first time, you may not have a lot of support documentation available, and that’s okay. The CRA will understand that you may not have known you would be applying for SR&ED when you discovered you could qualify. This is where you can ask the CRA – or an experienced SR&ED consultant – to show you how you can look for and gather the necessary evidence that will support any SR&ED experimentation you performed and the related expenses.
Planning for the future
In the future, though, if you continue to file SR&ED claims, the CRA will expect you to keep records of activities performed. It will be helpful for you to record your idea for trying your experiment, what type of experiment you did, and the experiment’s result. This includes recording plans, activities, results, and even implementing existing documentation systems using timesheets, status reports, or logbooks. You can also note if you are accomplishing the goal for the project and what you are learning from your experimentation.
Document examples
Specific examples of good supporting documentation include any prototypes you created, any minutes or notes you recorded during project meetings, emails that show the challenges or progress throughout the project, or even records of brainstorming sessions. It could be pictures, videos, notebooks, or drawings that clearly show the challenges and failures of your R&D activities.
Lastly, it will help the CRA (and future claims) if you can track the hours that the employees and subcontractors have spent on research, meetings, and experimentation throughout your project. This is key to ensuring that you can claim for the appropriate amount to get back every dollar you deserve.
Previous entry in the SR&ED blog series: What is the SR&ED Eligibility Criteria?
Next entry in the SR&ED blog series: What Activities are SR&ED Eligible?
About Banhall Consulting
Banhall Consulting LTD. was founded based on our passion for helping Canadian companies get the funding they need for their innovation to grow and thrive. Our dedication is helping companies with the SR&ED tax incentive program and how to navigate the complexities of the process and understand all necessary guidelines. Our team has decades of combined SR&ED experience and has worked on thousands of SR&ED claims. Our financial and technical experts have the versatility to assist companies in various industries in all areas of their SR&ED claim. Combining this experience and knowledge with our detailed-oriented methods has allowed us to achieve proven results with a 96% success rate on SR&ED claims.
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