New Video about SR&ED

Posted on July 23, 2012 by admin

NorthBridge Consultants has recently released an informative video about the Scientific Research and Experimental Development (SR&ED) program.

Posted in SR&ED News | Leave a comment

Changes to SR&ED May Have Negative Impact on R&D Investment in Aerospace

Posted on July 17, 2012 by admin

The Aerospace Industries Association of Canada (AIAC) released performance results for Canada’s aerospace industry in 2011.  Canadian aerospace industry revenue reached $22.4 billion in 2011, which was a 6.7% increase from 2010.  Expenditures on aerospace R&D increased to $2 billion in 2011, which was an increase of $500 million from 2010, while capital investment reached $600 million.

It was found that 75% of R&D investment originated from internal company sources, and the SR&ED tax credit and Strategic Aerospace and Defence Initiative (SADI) were cited as the main instruments that drove aerospace R&D investments.  Although over 60% of respondents to the survey agreed that there is future room for industry growth, AIAC’s members are worried that the changes to the SR&ED tax credit proposed in the federal budget may have a significant negative impact on future R&D investment decisions.

Posted in Changes to SR&ED | Tagged , , , | Leave a comment

SR&ED T661 claim form – 2012 Revision

Posted on July 9, 2012 by admin

In October 2012, the Canada Revenue Agency (CRA) will be releasing a revised Form T661, Scientific Research and Experimental Development (SR&ED) Expenditures Claim, to accommodate the legislative changes proposed in the March 2012 federal budget. 

The new Form T661(12), revision code 1201, will be accepted as of its publication date in October of 2012.  However, the old T661(11) version of the form can be submitted until December 31, 2012.  As of January 1, 2013, only the T661(12) version will be accepted for all tax years.

Posted in SR&ED News | Tagged , , | Leave a comment

Flaherty Wrong to Slash SR&ED Tax Credit

Posted on July 6, 2012 by admin

Jeffrey MacIntosh, Toronto Stock Exchange professor of capital markets at the University of Toronto Faculty of Law, opined in his recent article in the Financial Post that the changes to reduce the SR&ED program are ill-advised.  Many of the 20,000 CCPCs receiving SR&ED tax incentives are early-stage firms that reside within the capital-starved stage between government-financed research and later-stage private financing (i.e. the “Valley of Death”).  Any reduction in the SR&ED program could be a death blow to many of these seed-stage firms.

MacIntosh also criticizes the government’s comparative studies on direct assistance (via grants) versus indirect assistance (via tax credits).  The Jenkins report relied heavily on a study by the federal Department of Finance which found that within 5 years of incorporation, only 2% of SR&ED recipients grew into large firms that still performed R&D.  First of all, no comparative figures are offered for firms receiving direct assistance.  Secondly, the data used in the Department of Finance study could be suspect.  The study focused on firms that were incorporated in the period from 2000 to 2004- immediately following the bursting of the tech bubble, when failures were unusually high.

Posted in Changes to SR&ED, SR&ED News | Tagged | Leave a comment

Canada’s Competitiveness in the Pharmaceutical Sector

Posted on July 3, 2012 by admin

Canada’s Research-Based Pharmaceutical Companies (Rx&D) recently released their Patented Medicine Prices Review Board’s (PMPRB) 2011 Annual Report. Rx&D members continue to meet their 1987 research and development (SR&ED) goals of 10 percent of sales, but the international and domestic environments have changed substantially and this goal may need to be revised.

The PMPRB report showed that the typical Rx&D member invested an average of 9.75 percent of sales on eligible SR&ED eligible activities. However, this figure does not include collaborative research partnerships with universities, hospitals, centers of excellence,and early-stage biopharmaceutical companies. According to a report by KPMG in 2011, if these collaborations are accounted for, then Rx&D members would have actually invested 28 percent above and beyond what was captured by PMPRB’s 2010 annual report. 

Rx&D believes that regulations should be changed in order to more accurately document all pharmaceutical R&D in Canada.

 

 

Posted in SR&ED News | Tagged , , , | Leave a comment