As the landscape of Canadian innovation continues to evolve, the Scientific Research and Experimental Development (SR&ED) program plays a critical role in supporting various businesses engaged in research and development (R&D) activities. Within this program, the timing of your SR&ED claim submission holds more significance than you might think. Next, we will explore why punctuality with your claim filing can make a substantial difference in maximizing the benefits you receive and how you can accelerate growth with Easly Advances. Continue reading to learn more.
The Importance of the SR&ED Filing Deadline
Beyond simply being a regulatory formality, filing your SR&ED claim on time can substantially influence the outcome of your claim. The Canada Revenue Agency (CRA), the overseeing body for the SR&ED program, has established strict deadlines that businesses must heed.
For corporations, the SR&ED filing deadline is 18 months after the end of the tax year in which the eligible expenditures were incurred. So, if your business’s financial year ended in December 2021, you had until June 2023 to file your SR&ED claim for expenses incurred in the 2021 fiscal year.
This deadline isn’t simply a date to remember; it carries tangible consequences that can impact both your financial gains and the operational flow of your business. Below are some advantages of filing for SR&ED within the prescribed deadline:
Advantages of Timely Filing
- Faster Funding: Timely SR&ED claim submissions facilitate a faster turn-around of your refund. This translates into quicker access to funds, enabling you to put them to work without unnecessary delays. Although you can wait up to 18 months, it may be advantageous to claim eligible expenditures in the year immediately following when they were incurred.
- Budgetary Benefits: Filing your claim on a timely schedule allows you to budget and allocate resources more efficiently for ongoing and upcoming projects. You can plan to put your anticipated refund to work by submitting your claim as soon as possible.
- Simpler Audit: Timely claim submissions can help with a smoother audit process. The project is still fresh, and your details are more readily accessible, reducing the likelihood of errors or omissions. The further something is in the rearview mirror, the less clarity there is around it.
- Business Continuity: Avoiding late submissions prevents disruptions in your operations, sparing you the headaches that can arise from scrambling to meet missed deadlines.
Bridging the Gap in Funding with Easly
Aside from the SR&ED filing deadline, businesses must remember that even once your claim is submitted, it will still take a while before you receive your refund. This waiting period may range from weeks to months, depending on whether or not you’re subjected to an audit. If your business is being audited, you may wait up to six months before you receive funding, and that’s if your audit is successful.
Another important characteristic of the SR&ED program to note is that you only get one chance a year to submit your SR&ED claim. This means you need to wait months to be reimbursed for money spent throughout the year.
A strategic way to bridge the gap between expenditure and refund is SR&ED financing. This non-dilutive funding source allows you to advance your SR&ED credits and receive capital within two weeks of applying. With Easly Advances, you can access your capital in-year by leveraging your accrued SR&ED credits. We’ve deployed over $175 million in SR&ED advances across diverse sectors such as aerospace, defence, IT, media, and healthcare.
At Easly, we stand ready with the necessary funds to drive your R&D initiatives forward, ensuring minimal disruptions. Once your application gets the green light, you’ll have access to your initial advance in as little as 48 hours.