What is an SR&ED Tax Credit Loan?
Canadian businesses accrue SR&ED tax credits for a wide range of expenditures, from inventory and operating expenses to expanding current R&D projects. The CRA strives to review all accepted claims filed within 60 days and all refundable claims selected for audit review within 180 days, but this is only after the company has submitted Form T661 with their year-end taxes. This extended wait time for funds can leave organizations in a significant bind. Companies need ongoing cash flow to fund operations and continue growing.
Easly Advances allow companies to use future tax refunds and grant disbursements to secure non-dilutive funding throughout the year. Following a timely review process, funds from Easly are provided within 48 hours after approval. Companies can continue to draw-down throughout the year as they accrue more tax credits and secure more grants, smoothing cash flow.
SR&ED tax credit loans also provide an essential source of non-dilutive funding. Early access to these funds eliminates the need to sell equity or take on high-interest loans. Instead, the tax credit advance provides necessary financing while avoiding unaffordable debt and preserving the hard-won value and control over your business.
Which Companies Qualify for SR&ED Tax Benefits?
SR&ED tax credits are available to companies that operate in Canada and undertake eligible R&D endeavours. These include:
- Canadian-controlled private corporations (CCPCs)
- Other corporations
- Individual proprietorships
Funds allocated by these entities for R&D must be spent within Canada. This investment helps enhance the country’s innovation strategy, strengthens provincial and federal economies, and ensures Canada remains competitive in domestic and global markets.