The Scientific Research and Experimental Development (SR&ED) program of the Canada Revenue Agency was intended to encourage businesses of all kinds to perform research and development. It is Canada’s largest federally funded program, assisting businesses in the development of new goods, ideas, and solutions. The SR&ED program benefits society by assisting Canada’s economic growth and improving its worldwide competitiveness.
You can seek SR&ED funding if you have already qualified for the SR&ED tax credit. This is one of the finest solutions for companies looking to get their SR&ED funds sooner. You can also seek the help of an SR&ED refund calculator to quickly calculate your potential SR&ED refund amount.
Are you still unsure about the benefits of SR&ED funding? Take a look at our 3 explanations below.
1. Expand business operations
Business growth is fueled by innovation, and the CRA’s SR&ED program encourages it. The tax credit reimburses a significant amount of the expenditures of effective R&D, making it easier to develop, test, and market future goods. As you expand your footprint into other markets, your new items may quickly change your domestic Canadian firm into a worldwide one.
Small firms frequently struggle to break even, let alone scale significantly. You may be able to raise your earnings and market share exponentially rather than incrementally by employing the CRA SR&ED program to develop new products and processes. Increasing your long-term revenue can help you acquire market share from your competition. You could even be able to take the majority of your industry’s market thanks to explosive expansion powered by innovation. Small firms no longer have to rely solely on venture capitalist loans for funding.
2. Quickly unlock an asset
SR&ED financing helps SR&ED and OIDMTC eligible firms receive the money in 1 week. This implies you’ll be able to acquire cash advances regularly and at reasonable rates.
SR&ED and OIDMTC tax credits might take anywhere from six months to two years to get funding or credits. What if you need the money right away, rather than waiting six months for SR&ED and two years for OIDMTC? You require the funds immediately so that you can invest in emerging technology. This is where SR&ED finance comes in handy, as it allows you to receive funds sooner.
3. Non-Dilutive Capital
Usually, it is difficult to get funding for your firm without first selling stock in the company. This is why SR&ED financing is such a good idea; you don’t have to sell any of your firm’s equity. None. You retain complete ownership of your company.
Bottom Line
Advance funding for SR&ED can create a virtuous cycle. As a growing, research- or technology-focused business, you’ll certainly keep investing in technology. Receiving funds promptly will certainly give a good boost to your business and this is where SR&ED financing becomes important for any business.
