R & D tax credits are claimed on a tax return using prescribed forms. These must be filed within one year of the tax return’s normal filing deadline (which is 6 months after year-end for a corporation). If these forms are not filed on a timely basis, no credits can be claimed for that year.
For Canadian-controlled private corporations, a portion of the R & D tax credits can be refunded. Otherwise, the credits apply only against taxes payable, but can be carried forward for 20 years or back for 3 years.
Many provinces have their own incentives for R & D carried on within their boundaries. These are claimed on provincial tax returns.
We can prepare or review the company’s tax returns (federal and all provinces) and work to optimize the claim. We maximize the amount refundable by considering the company’s overall tax position, tax rate, provincial tax position, ownership structure, and discretionary tax deductions. By specializing in R & D tax credit filings over many years, we have developed a series of effective tax-planning strategies.