CRA Announces New Details About Proposed SR&ED Pre-approval Service
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Today, the CRA (Canada Revenue Agency) unveiled a new survey they’re asking the public to complete, to help to determine the feasibility of a SR&ED pre-approval service that would help businesses plan and budget their SR&ED projects. In doing so, they also revealed some interesting new morsels about what the service would look like and how it would affect SR&ED.
Back in January, the CRA announced that it was undertaking a pilot project to see how effective a SR&ED pre-approval service could be for Canadian businesses. With that process well underway, the CRA posted a questionnaire to allow businesses that aren’t participants in the project an opportunity to contribute. Most interesting, though, are the tidbits of information about the service that came along with the questionnaire.
What the Service Would Provide
The goal of the pre-approval service would be to give businesses more certainty about what they can expect from their SR&ED claims and projects by providing real time eligibility updates and eligibility determination of the SR&ED claim before it’s filed. The post says claimants would also be offered the following services:
- Advisory services on the SR&ED program;
- Information and advice on preparing and submitting an SR&ED claim;
- Faster processing of their SR&ED tax incentives;
- All the information needed to fill out Form T661;
- A reduction of the effort to prepare an SR&ED claim at year end; and
- Certainty that the SR&ED claim or project that undergoes this service will not be subjected to a post-filing onsite review.
Who Could Use the Service
Not everyone will be able to employ the pre-approval service; the post also explains that businesses must meet the following criteria to be eligible:
- Able to claim SR&ED tax incentives;
- Not a partnership or a sole proprietorship;
- Will start at least one new SR&ED project during its current fiscal year;
- Is seeking pre-approval for one of the following options: Their whole SR&ED claim and expects to claim 20 or less projects, or only one new project that is expected to end within three years and the estimated SR&ED expenditures for each fiscal year will be between $50,000 and $1,000,000;
- Does not have any SR&ED claims under objection with the CRA or in litigation for projects or issues continuing into the time frame of the service; and
- Is up-to-date with its filing of SR&ED claims and does not have more than one year under review.