A turning point in every SR&ED claim is the site visit conducted by the CRA. How the visit goes and the CRA’s findings through the Research Technological Adviser assigned to review your claim can arguably make or break the results. During the site visit, you may have been asked to provide additional information, and first off, good job for making it through the visit. Now, it’s time to gather the additional documentation required, and with the ongoing support of your SR&ED firm and its consultants in Toronto, you can better understand how the CRA communicates, reports, and finalizes the results of your SR&ED claim.
SR&ED Review Report
After the site visit, and when additional documentation has been reviewed, the RTA will document the results of their assessment in the SR&ED Review Report, which you will receive, read, and may better understand with the help of SR&ED firms you worked with in filing your claim.
The SR&ED Review Report is a summary of the technical review and documents the facts of the claim which you submitted and were observed the the CRA. It also explains and provides a rationale concerning the resulting decision, with a focus on the eligibility assessment of the SR&ED work you performed, and other related issues. When it is appropriate, the Report will also include recommendations for improving future SR&ED claims, such as improvements to project information, documentation, supporting evidence, and a determination of what kind of work should or should not be claimed.
Understanding Technical and Financial Review Findings
After completing the review process, the CRA will then send you their findings. This includes documents completed by both the RTA and the Financial Reviewer (CRA), which are: a proposal letter with a summary of proposed adjustment to claimed expenditures; a copy of the SR&ED Review Report; and recommendations and requests for future claims, usually concerning your company’s books and records.
These can either be presented to you by the RTA and FR in a meeting, discussed over the phone, or sent to you, which you can go over with your SR&ED consultant for better understanding.
If you and your SR&ED firm find that you do not agree with the findings, or have questions, you can respond within a 30-day deadline. You can ask for explanations or clarifications, rebut the CRA’s position in writing, or provide new information for consideration – all of which the CRA will review, and can result in amendments to your claim.
Resolving Disputes
If you and your SR&ED consultant find that you disagree with the RTA’s decisions, you can register these disputes with the CRA. For this, the CRA’s commitment is to resolve disputes at appropriate levels, escalating claims only to the Assistant Director for SR&ED at the final stage.
The CRA encourages claimants to discuss concerns first with their assigned RTA. RTAs are expected to explain the rationale for eligibility determination, while as the claimant, you are also expected to explain your concerns and provide supporting documentation when applicable, so that these can be considered in the review process.
Appealing the CRA’s Decision
As no system is perfect, the CRA makes room for disagreements with the notice of assessment or reassessment. As a claimant, you are rightfully entitled to a formal review, which starts with filing a notice of objection of the CRA, which are handled by the Appeals Branch. During this time, you can work with your SR&ED consultant in Toronto to assemble all necessary documentation that will support your objections – all aimed at a successful SR&ED claim approval.