SR&ED – Impact of the 2012 Federal Budget The 2012 federal budget was tabled at the end of March 29th, 2012. Minister Flaherty pursued some recommendations of the Jenkins report in modifying some SR&ED tax credit expenditures calculation rules. Here is a brief preview: The general SR&ED tax credit rate (intended to corporations whose profits exceed $800,000 and to public corporations) will go from 20% to 15% for the imposition years ending after 2013. From January 1st, 2014, the capital expenditures (such as machinery, computer equipment, etc.) will be eliminated of the SR&ED tax credit eligible expenditures. The rate used in the SR&ED labour expenditures replacement method will go from 65% to 60% in 2013, then it will be of 55% for the subsequent years. Only 80% of the SR&ED expenditures paid to a subcontractor without dependence connection will be eligible to the SR&ED tax credit after December 31st, 2012. For more information, you can consult the webinar « RS&DE – Retour sur le budget fédéral 2012 ».