What happens after you have submitted a SR&ED claim to CRA?

SR&ED CRA filing - What happens when you make a SRED Claim

The Scientific Research and Experimental Development (SR&ED) tax incentive program is a federal incentive program for companies performing scientific or technological research. It supports companies doing research to make technological advancements in situations of technological uncertainty.

When you submit an SRED claim to the Canada Revenue Agency (CRA), it will go into a thorough screening process to determine if your corporation is eligible for the claim and whether it is completed correctly. When approved you will receive an SR&ED investment tax credit for your income tax or a refund.

Sometimes CRA will decide that more information is needed to complete the screening process. In that case your claim will be sent to a tax service office where professional technical and financial reviewers will evaluate the claim . The reviewers of the CRA may even decide to visit your place of business to speak with staff members and collect supporting evidence.

CRA SR&ED Program Service Standards

The Canada Revenue Agency follows specific service standards to process SR&ED claims. When you submit a claim for your research and experimental development projects, the CRA is devoted to meeting service standards 90 percent of the time. These service standards include:

• Any claims that have been filed will be reviewed and processed within 60 days of the date that the claim was received.
• If any claim requires specific investigation and further review, the audit must be completed within 180 days that a complete claim was received.

To closely monitor your claim, the Canada Revenue Agency offers a CRA Times tool, where you can find out when your claim is expected to be processed. The tool asks a series of questions and offers a selection of choices in a drop-down menu. Once you answer the questions, the tool will give you a time in which you can expect your claim to be processed.

What happens when your Claim is selected for a Technical Review

If your claim is selected for further technical review, your technology and financial staff will meet with reviewers. The technical reviewer first determines the strength of eligibility of your SR&ED claim. Then the financial reviewers from the CRA will evaluate the scope of eligible SR&ED expenditures to ensure any costs associated with your claim are for the SR&ED tax credit and allowed within the Income Tax Act.

The CRA research and technology reviewers are responsible for determining whether your project meets SR&ED eligibility criteria. Each detailed review consists of three steps:

• Preparing and planning
• Conducting the review
• Communicating, reporting, and finalizing the results

Preparing and planning

In this phase, the CRA does a thorough review of any information, identifies any issues, and reaches out to you, the claimant. This is when further discussion about the claim will continue. In some cases, the issue can be resolved on the phone, but typically an on-site visit is scheduled to discuss further.

Conducting the review

A review often requires a site visit where the SR&ED claim can be further evaluated. The Research and Technology Reviewer (RTA) will take a tour of the premises, gather the information that supports the claim, and interview people involved in the SR&ED work.

Communicating, reporting, and finalizing the results

In the final step of the review process, the CRA will present a review report which includes the financial review and the technical review based on the RTA’s findings. It will also include information on the dispute and resolution process, and the appeals process.