Saskatchewan SR&ED Program: Tax Credits for R&D

1. Saskatchewan SR&ED Tax Credit Guide

2. The Saskatchewan SR&ED (Scientific Research and Experimental Development) tax credit is a valuable program aimed at supporting research and development (R&D) activities within the province. This tax credit provides various incentives depending on the sort of corporation as well as the amount of qualifying R&D costs. This program is run and managed by the Canada Revenue Agency to support innovation and R&D activities in this province.

3. Eligibility for the Saskatchewan SR&ED Tax Credit Corporations which are operating business in Saskatchewan can claim the Saskatchewan SR&ED tax credit, even if they are of a partnership and the beneficiary of a trust. These corporations must conduct eligible SR&ED activities in the province to qualify for the tax credit.

4. Tax Credit Rates for Canadian-Controlled Private Corporations (CCPCs) Since April 1, 2017, eligible R&D expenditures for Canadian-controlled private corporations (CCPCs) qualify for a 10% refundable R&D tax credit on expenditures up to an annual limit of $1 million. For expenditures exceeding $1 million, a 10% non-refundable R&D tax credit applies. For non-CCPC corporations, the R&D tax credit is non-refundable, with a rate of 10% on eligible expenditures incurred after March 31, 2015.

5. Previous Tax Credit Rates and Limits From April 1, 2015, to March 31, 2012, a 15% non-refundable tax credit was available, with a $3 million expenditure limit for CCPCs. From April 1, 2012, to March 31, 2009, a refundable rate of 15% was available for eligible expenditures in all cases.

6. Eligible Expenditures and Work The expenditures that qualified for the Saskatchewan SR&ED tax credit are also those that are qualified for the federal SR&ED investment tax credit. This ensures that companies conducting SR&ED activities under federal guidelines can also access provincial support for their projects in Saskatchewan.

7. Carryback and Carryforward Provisions Non-refundable tax credits can be carried back three years or carried forward up to ten years. These credits can then again be used against Saskatchewan income taxes making flexibilities in case of taxation.

8. Impact of Assistance on Eligible Expenditures Any eligible expenditures are reduced by government and non- government assistance, though not by the Saskatchewan R&D tax credit itself. The provincial tax credit will reduce the federal pool of deductible SR&ED expenditures and qualified SR&ED expenditures.

9. Renouncing the Saskatchewan R&D Tax Credit Corporations can renounce all or part of their Saskatchewan R&D tax credit entitlement. It can be done for the qualified expenses for the year, as per federal rules subject to certain conditions.

10. Filing Requirements To be eligible for the Saskatchewan SR&ED tax credit, corporations have been required to attach a special document, namely Form T2SCH403 the Saskatchewan Research and Development Tax Credit. This form helps the Canada Revenue Agency process claims accurately and ensures compliance with provincial guidelines.

11. Relevant Legislation The Saskatchewan SR&ED tax credit is governed by sections 63 to 63.4 of The Income Tax Act (Saskatchewan).

12. The Saskatchewan SR&ED tax credit offers valuable incentives for corporations engaged in research and development in Saskatchewan. This program facilitates innovation by offering two tax credit options: refundable and non-refundable. Eligible corporations should consider utilizing this tax credit to optimize their R&D investments while complying with federal and provincial guidelines. Back to Agenda Page

13. Contact Details www.canadiansred.ca info@canadiansred.ca 587-200-4163