The Scientific Research and Experimental Development (SR&ED) tax incentive program is the largest single source of federal and provincial government support for industrial R&D. It aims to encourage Canadian businesses in all sectors to conduct research and development (R&D) in Canada that will lead to new, improved, or technologically advanced products or processes.

It gives claimants cash refunds and/or tax credits combined up to 74% for their expenditures on eligible R&D work done in Canada.

To qualify for the SR&ED program, work must:

• advance the understanding of scientific relations or technologies;
• address scientific or technological uncertainty; and
• incorporate a systematic investigation by qualified personnel.

The following projects are eligible for benefits under the program:

• experimental development to achieve technological advancement to create new materials, devices, products, or processes, or improve existing ones;
• applied research to advance scientific knowledge with a specific practical application in view;
• basic research to advance scientific knowledge without a specific practical application in view; and
• support work in engineering, design, operations research, mathematical analysis, computer programming, data collection, testing, or psychological research, but only if the work is commensurate with, and directly supports the eligible experimental development, or applied or basic research.