For many small to medium sized business owners, Spring is a crucial time as it marks the start of tax season. Between filing your business’ corporate taxes to preparing your SR&ED claim, tax season can quickly become an overwhelming and stressful time for first-time or less experienced claimants. In fact, many business owners who attempt to file an SR&ED claim on their own for the first time make one of many common mistakes which ultimately hinder the success of their SR&ED claim.
Luckily, at CI Solutions, our SR&ED consultants have the knowledge and experience to help your business curate a favourable SR&ED claim. Backed by years of successful practice, our SR&ED specialists are dedicated to help small to medium sized businesses like yours confidently prepare, process and submit their SR&ED return.
Interested to learn more about common mistakes you should avoid when claiming SR&ED? Keep reading:
Submitting Incomplete Project Descriptions
One of the most common mistakes business owners make when filing for SR&ED is submitting incomplete project descriptions. While project descriptions may appear as only a small portion of the paperwork required for an SR&ED claim, it should be noted that it is actually the heart of all SR&ED claims.
As a business owner, a brief summary of your project may already make sense to you. However, it’s important to keep in mind that the CRA representative evaluating your claim has little to no background information or knowledge on your business and its developmental efforts and milestones. Depending on their understanding of the information you provide, your claim may be at risk of disapproval if your claim fails to paint an adequate picture of the scientific breakthroughs achieved in the past year.
To bridge this gap, our SR&ED consultants recommend that business owners take the time to curate highly detailed and comprehensive project descriptions which accurately outline the experimental research and development efforts of their facility in order to help the CRA fully understand the complexity and intent of your project.
Compiling Insufficient Documentation
Similar to how businesses are expected to keep organized records and documentation of their annual business expenses in preparation for tax season, the same is expected when filing for SR&ED tax credits. Not only is sufficient documentation key to having your claim approved, it will also help the CRA properly assess your business’ eligibility.
When business owners submit an SR&ED claim without the proper documentation attached, the chances of it being deemed ineligible by the CRA rises substantially. As a result, our SR&ED consultants recommend submitting as much relevant documentation as possible. Generally speaking, the more your claim is worth, the more documentation you’ll want to provide to the CRA.
Missing The Deadline
One of the most obvious yet costly mistakes business owners make when filing for SR&ED is missing the deadline. While the 18-month window to prepare and submit your SR&ED claim may seem like more than enough time, SR&ED consultants recommend planning ahead. From providing insufficient documentation to missing paperwork, these minor oversights could end up pushing you out of the 18-month deadline–a statute barred deadline that even the Minister of Revenue cannot overturn. As a result, it is pivotal to ensure that your claims are properly lined up in advance to avoid missing the deadline.
Not Working With SR&ED Consultants
Overwhelmed by the paperwork involved with your SR&ED claim? Our SR&ED specialists at CI Solutions offer tailored consulting services to help business owners like you prepare and process an elaborate SR&ED claim. Between meeting with you to screen your projects and eligibility, to preparing a comprehensive technical report detailing your facility’s experimental activity and submitting your claim, our SR&ED consultants will work closely with you every step along the way.
This Spring, ensure that your business in Calgary, Edmonton or Toronto receives the best return possible when you work with experienced SR&ED consultants like ours at CI Solutions.