The SR&ED Review: Purposes and Types

Funding Program - SR&ED

When you submit your SR&ED application, there is always the possibility that the Canada Revenue Agency (CRA) will review the claim to make sure if the project meets the requirements of SR&ED. Naturally, an SR&ED review needs to be treated seriously and professionally, but it is not necessary to be afraid and stop the application process. This series of articles will go over all the details of the SR&ED review and everything applicants may expect from it.

What is the SR&ED Review for?

The purpose of the SR&ED review is to educate applicants and evaluate the eligibility of their claims. Therefore, the reviewers may ask questions about how the application has been carried out and check the applicants’ knowledge about the SR&ED project. These answers will help the reviewers to understand how familiar and involved the applicant is with the SR&ED project. Moreover, the reviewers will also offer valuable suggestions about letting future claims continue being eligible for SR&ED in the next few years.

For a more specific example, here are some common issues that may lead to a SR&ED review:

  • Weak or ineligible SR&ED projects
  • Poor documentation and record-keeping
  • High subcontractor expenditures
  • High overseas expenditures
  • Multiple grants and SR&ED claimed in the same year

Different Types of SR&ED Reviews

Desktop Review

After filling out all the required forms for the SR&ED claim and submitting the application, all SR&ED materials will first go through the CRA taxation center to ensure accuracy. This process is called the non-technical review or desktop review. Generally speaking, the materials will be checked based on the following categories:

  • Financial size of the project
  • First-year application or a continued project from previous years
  • Changes and adjustments
  • Previous findings
  • Date of previous reviews (if any)

The non-technical review is a fast process but the following steps are more professional. Both the financial review and the technical review are called the specialist review because they will be carried out by research and technology advisors (RTAs) and financial reviewers from the CRA.

Financial Review

As discussed above, a financial review may be triggered by high subcontractor fees, high overseas expenditures, or other potential issues. The financial reviewer may send a review letter to the company to ask for more information and supporting materials. If all the issues are answered perfectly, the claim might be approved. If the reviewer is still unsatisfied with the response or has some concerns, the review will continue and an RTA will be assigned to the case.

Technical Review

The RTA from the CRA should have a strong science or technology background. When performing the technical review, they will search specifically for non-eligible activities, because sometimes the financials are strong but the CRA is not sure your SR&ED projects are dealing with a scientific advancement (basic research, applied research, and/or experimental development). Like the financial review, the RTA may also ask the applicant for additional supporting documents. However, if the issues still cannot be fixed, they may conduct an on-site meeting. (Due to the COVID-19, all the meetings are currently online.)

SR&ED Review vs. FTCAS: What is the Difference?

What is FTCAS?

FTCAS is the abbreviation for First-Time Claimant Advisory Service, which is a program introduced by the CRA in 2014. The objective of FTCAS is to provide assistance and education for first-time SR&ED applicants so they can have a better understanding of what the CRA is looking for in SR&ED claims.

FTCAS means your application is pre-approved and after the meeting, the process will continue in the right direction. The CRA will not determine the eligibility of your claimed project during FTCAS.

The SR&ED Review

The Review, however, is much more complicated. In addition to all the supporting documents you need to provide as requested, the CRA could approve or deny your SR&ED claim during the review process.

Keep the information in mind and don’t confuse FTCAS with Review. If an SR&ED review is required, to be better prepared, you may need to contact a professional tax consultant once the review requirement is received.


The SR&ED review is a serious and professional process every applicant has to pay attention to. However, it is still a common situation and there is no reason to be feared. In the next article, we will discuss more details on the review process and all the materials that the SR&ED applicants need to prepare for the review. If you are interested in applying for SR&ED but are unsure about some project details,  scheduling a face-to-face appointment with our SR&ED consultant will help you understand more about the SR&ED claim.

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