Several industries have already faced the brunt of the ongoing COVID-19 crisis, with the SRED tax credit industry being no exception. This pandemic has created uncertainty in the financial market and business community. To protect Canadians’ health and businesses against financial harm, you can take several immediate and proactive steps to manage the cash flow during challenging times. Some of these comprise tax planning, using extended tax deadlines, and access to government incentives.
SRED and the Impact of COVID
This is a challenging time for most companies, which also includes the impact of the crisis on the SRED tax credit claims. So it is vital that you select a competent professional. They will help in your tax calculations and aid to streamline the process better.
Businesses, especially startups, have faced a delay in processing the existing application to which SR&ED CRA has indicated clearly that the priority will continue to be with the SRED program. To ensure that businesses that are not foreign-owned or publicly owned receive the utmost support, the CCPC (Canadian-controlled private corporations) will prioritize refundable tax credits processing. There will be not many new audits or new reviews, while those in progress will soon get finalized to make sure that the business receives quick credits. On the other hand, approved applications at the time of the crisis will be audited or reviewed subsequently for that posteriori eligibility confirmation.
In the case of a taxpayer, despite the relaxation of rules to allow the tax payment deferral, the deadlines for e-business claims and SRED remain unchanged. The onsite visit that the IQ undertakes following the initial e-business application will now occur only when there are subsequent claims. In the form of relief measures, the IQ will provide a tax credit eligibility certificate sans the payment of the fee will get postponed to a later date…