12 posts

SR&ED and Due Diligence

In today’s blog post, we’ll look at the misunderstood role of due diligence and how it pertains to SR&ED. Due diligence is a critical component of the ‘Technological Uncertainty’ which is one of the three main criteria of the program. In order to establish that a technological uncertainty exists, an organization must perform some due diligence to determine if the uncertainty is readily solvable using available knowledge, or if no information exists. Without performing this critical step, it is not possible to establish a valid technological uncertainty. There are two main misconceptions we see regarding due diligence and SR&ED. First, due diligence is a required component of the program, however the time spent in performing this task is not eligible. The reason for this is that you must establish that a technological uncertainty exists before you can begin your systematic investigation and/or experimental development and your due diligence precedes the establishment […]

SR&ED and the Administrative Review

On May 30, the CRA announced a new form, known as the RC532 with an eye towards improving the SR&ED administrative review process. The CRA hopes that this form with help monitor and track SR&ED reviews (for the purpose of training and policy clarification), making reviews more consistent. The form itself is straightforward and does make the filing a request for an administrative review somewhat simpler. The claimant is now (1) asked to explain the nature of the concern, (2) whether these concerns were brought to the attention of the reviewer and (3) were the concerns brought to the attention of the manager. These three questions (which have always existed) formalize the process a claimant must go through in order to apply for an administrative review. It remains to see how effective this form will be in dealing with the frustrations of the claimant. The criteria for an administrative review has […]

When the CRA Calls About Your SR&ED Claim

Oftentimes when the CRA is reviewing an SR&ED claim, a reviewer will call the claimant either to get more information or set up an onsite visit. CRA reviewers will often re-assure the claimant that nothing is wrong at this stage, and they are simply gathering information. This is not entirely accurate, and as a claimant you should be concerned. If a CRA reviewer calls you about your SR&ED claim, it means that the claim has been selected for review. At this stage it is unlikely that the CRA will tell you whether you are subject to a desk, onsite technical or financial review. Consequently, it is important to make sure you plan to set aside some time to answer any queries the CRA reviewer(s) may have in regards to your claim. Here are some simple things you can do to help organize the process and determine who and how much time will […]