Quebec Program Encourages R&D Partnerships by Providing Large Firms with Additional Tax Credits

The Crédit d’impôt pour un projet de recherche précompétitive en partenariat privé, or tax credit for a pre-competitive research project through a private partnership, encourages smaller firms to partner with larger firms, in order to keep R&D in Quebec.  As long as one of the partnering firms is in Quebec, the smaller firm gains access to greater resources for R&D investment while retaining the intellectual property.  The larger firm, on the other hand, gets to claim an additional 35% tax credit above and beyond SR&ED.  Those additional credits are applied to whatever R&D costs might remain after the partnering businesses receive their SR&ED tax credit.