The CRA SR&ED Claim Review Process

CRA SR&ED claim review process
What is the SR&ED claim review process?

The SR&ED tax credit program is the largest single source of R&D funding in Canada: over $3 billion in tax incentives are distributed annually.1 If you choose to access this program, it’s helpful to understand how applications are processed. 

What actually happens when an SR&ED claim is received by the CRA? We walk you through the process, including providing some important background information.

Background: The Right Forms, Correctly, At The Right Time

SR&ED Filing Deadlines

First, it’s important to know your deadlines – if you miss the deadline, the rest doesn’t matter.

Businesses can file their SR&ED claims: concurrently with their corporate taxes, or as an amendment within the 18-month filing deadline. This means that a corporation that incurred SR&ED expenses has up to 18 months from the end of that tax year to file an SR&ED claim.  (For due dates and required documentation, it is always best to consult the CRA directly.)

We have created a list of all the taxation services offices in Canada. Taxation Services Offices (TSOs) do not offer a “walk-in counter service […] in any [location].”2

Correct & Complete

Next, it’s critical that the correct forms are filed. The Canada Revenue Agency (CRA)’s SR&ED Filing Requirements Policy states that in order for an SR&ED claim to be filed correctly, claimants must include the following:

To learn more about provincial forms, visit our interactive R&D tax credits page.

SR&ED Review Process

Once all of these and any other relevant forms have been completed and filed, what happens next?

This article identifies the four potential stages of the SR&ED claim review process, once the claim has been filed:

  1. Non-Technical Review (Taxation Centre)
  2. General Review (Taxation Services Office – Control Function – Research and Technology Officer)
  3. Specialist Review – Technical and/or Financial (Taxation Services Office – Research and Technology Advisor / Financial Reviewer)
  4. Dispute Resolution

CRA Taxation Centre

Non-Technical Review

At the taxation centre, your claim forms are reviewed for completeness. Anecdotally, the forms are then assessed based on the following categories, among others:

  • financial size;
  • change from prior years;
  • any prior adjustments;
  • date of the last review;
  • presence of projects spanning more than 3 years; and,
  • previous eligibility findings.

The reviewer generally does not have a technical background, but if your claim seems in line with past claims and the forms are complete, they will often recommend that it is “downscreened”  and accepted as filed. In this case, the result is a fast turnaround.

From the Claim Review Manual:

The risk management process for SR&ED claims begins as soon as the CRA’s Tax Centre (TC) receives a claim and it continues throughout the entire review process. When a claim is received in the TC, it is reviewed for completeness. Complete claims are processed through the risk management tool, and are either downscreened or referred to the Control Function (CF) in the coordinating tax services office (CTSO). (4.3.0)

CRA Taxation Services Office

Research and Technology Officer

From the Claim Review Manual:

The CF performs a risk assessment as well, and either accepts the claim as filed, or identifies possible areas of concern and refers the file to an RTA and/or an FR. (4.3.0)

Generally, this will be performed by the Research and Technology Officer (RTO) who will have a science or technology background and will perform a general technical review, in which they search for possible non-eligible activities and expenses. The RTO is looking for a solid technical / technological tone. Additionally, the RTO looks for so-called “trigger words”—words that should not be used as they discredit the claim or the work performed.

However, if there are no obvious issues or comments about the claim in the CRA database, the RTO might recommend downscreening—accepting the document as is. However, if the RTO has any questions or concerns, they will make notes of potential non-compliance issues, and the file will then be transferred to a Research and Technology Advisor.

Research and Technology Advisor and/or Financial Reviewer (Specialist Review)

From the Claim Review Manual:

To assess the risk, the RTA considers many of the same risk factors as the CF and the TC, but reviews them with greater depth and with the perspective of their specialized knowledge. Risk assessment is ongoing throughout the entire review process. As the review progresses, the RTA learns more about the compliance issues for the specific claim and is in a better position to assess the risk of non-compliance. (4.3.1)

Research and Technology Advisors (RTAs) generally have more specific education and experience than RTOs, and they will have specialized expertise in the particular area of the claim. Their role is to verify whether the comments and concerns of the RTO warrant further investigation, which may include a visit to the claimant.

Alternatively, the file may be sent directly to a Financial Reviewer. Financial Reviewers have a background in accounting or financial management and will analyze the financial information in the claim, including items such as eligible costs.

Note: The majority of onsite visits are now joint reviews, whether or not there are issues with both technical and financial information. 

From the Claim Review Manual:

There are three basic review methods for resolving issues:

  • review without an on-site visit, with or without claimant contact;
  • review with an on-site visit; or
  • referrals or consultations.

The method to resolve the issues relates to the risk assessment, as noted in Chapter A simple way to relate the risk assessment to the method is noted in this list:

  1. low risk – desk review without claimant contact,
  2. medium risk – desk review with claimant contact,
  3. high risk – review with an on-site visit; or
  4. unable to determine risk based on lack of knowledge/ information-review with an on-site visit. (4.7.0)

If your file is low or medium risk and all the issues have been resolved, your file will be submitted for further processing and you will receive your refund. 

However, if there appears to be a significant potential non-compliance issue, they may decide to conduct an on-site visit. If the RTA does decide to visit with the claimant to discuss the claim, they will be looking for documented proof to substantiate the claim.

Assuming all goes well with the onsite visite, you will receive a SR&ED Review Report. If accepted, your file will be submitted for further processing and you will receive your refund. 

If You Dispute Your Assessment

If, however, the onsite visit does not go well or you don’t agree with the SR&ED Review Report, you will then get into the dispute resolution process.

Research and Technology Manager

Research and Technology Managers (RTMs) supervise and manage RTAs, and are required to sign off on the technical and financial reports produced by the RTA if an adjustment is made. In the event of a dispute arising between the assessment of the claim by the RTA and the claimant, or if there are concerns or questions regarding the RTA or the review, the RTM is the individual you should contact. This process can delay the processing of your SR&ED claim. For more details on the process, please review the Claim Review Manual.

(We have also written more about surviving SR&ED reviews and what to do if you want to dispute CRA’s assessment of your claim in other articles.)

SR&ED Processing Timelines

This  CRA recently revamped its guidelines relating to SR&ED service standards such that:

  • Claims received after April 1, 2018, will be processed within 60 days, providing the claim is accepted as filed.
  • Claims earmarked for review/audit will be completed within 180 calendar days of receipt4.
Type of ClaimNumber of Days to ProcessCRA Success Rate
All claims accepted as filed60 Days90%
Refundable claims selected for review/audit180 Days90%
All claims90%
CRA updated service standards: April 1 2018 1

The CRA aims to achieve this standard 90% of the time, so budget accordingly.

(You can read a more in-depth look at the service standard changes on our blog.)

The CRA’s SR&ED Filing Requirements Policy provides some additional insight on how quickly claims are processed depending on how they are received by the tax office:

Claims that are hand-delivered will be considered filed on that day. First-class mail or daily service will be considered filed on the date of the postmark. If the SR&ED reporting deadline happens to fall on a Saturday, Sunday or a public holiday recognized by the CRA, the filing deadline is extended to the next business day. Some recognized public holidays are specific to a province or territory. For a detailed listing of public holidays recognized by the CRA, please refer to the CRA Website.

For claims received through CRA‘s Corporation Internet Filing service, the filing date is the date that the confirmation number is issued.5

Conclusion: SR&ED Claim Review Process

All SR&ED claims go through the same initial process with officers at the CRA. More complex or disputed claims will go through additional stages for the CRA to reach a final verdict. The processing times, therefore, will vary greatly. The best solution is to ensure you put forward a strong submission and aim to be “downscreened” in order to receive your refund as soon as possible.

Do you still have questions about where your SR&ED claim is going and how long it might take to process?
** Note: In 2020, the CRA updated the term “Ombudsman” to “Ombudsperson”. ** 

Show 5 footnotes

  1. Government of Canada. (2015, April 7). Evolution of the SR&ED Program Retrieved April 4, 2019, from https://www.canada.ca/en/revenue-agency/services/scientific-research-experimental-development-tax-incentive-program/evolution-program-a-historical-perspective.html
  2. Government of Canada. (April 3, 2023.) Contact us about SR&ED. (Accessed: April 5, 2023.) Retrieved from: https://www.canada.ca/en/revenue-agency/services/scientific-research-experimental-development-tax-incentive-program/contacts.html.
  3. Government of Canada. (December 18, 2014.) SR&ED Filing Requirements Policy. Question 1 What is the difference between an SR&ED claim that meets the SR&ED filing requirements and the requirements for processing an SR&ED claim? Processing an SR&ED claim. (Accessed: October 3, 2017.) Retrieved from: https://www.canada.ca/en/revenue-agency/services/scientific-research-experimental-development-tax-incentive-program/filing-requirements-policy.html#s8_1.
  4. Government of Canada. (2019, February 21). SR&ED Program Service Standards. Retrieved April 2, 2019, from https://www.canada.ca/en/revenue-agency/services/scientific-research-experimental-development-tax-incentive-program/program-service-standards.html
  5. Government of Canada. (December 18, 2014.) SR&ED Filing Requirements Policy. (7.4) Date Received. (Accessed: October 3, 2017.) Retrieved from: https://www.canada.ca/en/revenue-agency/services/scientific-research-experimental-development-tax-incentive-program/filing-requirements-policy.html#s7_4.

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