SR&ED Policy Review Project


The Scientific Research and Experimental Development (SR&ED) program is committed to placing a continued emphasis on the needs of Canadian businesses, particularly with respect to reducing the compliance burden, ensuring awareness of the SR&ED program, and enhancing accessibility to the program.

In the fall of 2007, the Canada Revenue Agency (CRA) and the Department of Finance Canada conducted consultations on how to make the SR&ED program more effective for Canadian businesses. Based on these consultations, the Government of Canada announced in the 2008 Federal Budget several actions to improve the administration of the SR&ED program, including the review of SR&ED policies and procedures.


The objectives of the SR&ED Policy Review Project are to consolidate and clarify the policy documents and related guidance documents with respect to the SR&ED program. The objective is also to present this information in a user-friendly way on the SR&ED Web pages of the CRA Web site.

The result will be an up-to-date Web-based source for all SR&ED policy information that will help reduce the complexity of the SR&ED program and therefore enhance accessibility, particularly for small businesses.


The following steps give a general overview of how the SR&ED Policy Review Project is being carried out:

1. Consult stakeholders

SR&ED program officials have met with various stakeholders, including associations and accounting firms, to collect their opinions on the clarity of the current SR&ED policy documents and related guidance documents and to identify those that need improvement. The recommendations and feedback received were crucial to our initial review of these documents.

2. Organize information

We are currently reviewing the SR&ED policy documents and related guidance documents using a topic-based approach. In this regard, we have organized the SR&ED policy information into three categories of topics: financial, scientific, and joint financial/scientific. In order to organize the existing policy information, we have identified where each topic and keyword is found in the SR&ED publications that are available on the SR&ED Web pages.

  1. Financial topics based on Form T661 (line numbers 300 to 820);
  2. Three scientific topics (SR&ED Eligibility, Support Work, and Excluded Work) based on the definition of SR&ED in the Income Tax Act.
  3. Joint financial/scientific topics

3. Draft documents

For each topic we will be creating a policy document. That policy document will:

  • consolidate the relevant information from all the current SR&ED publications,
  • eliminate any redundant or obsolete information,
  • streamline and restructure the information,
  • include references to the Income Tax Act and explanations from case law to increase clarity, and,
  • provide additional examples.

It is important to note that the principles explained in the current SR&ED policy documents and related guidance documents will not change. 

4. Conduct online public consultations

Over the course of 2010-2011, we will be asking the public to provide feedback on the draft policy documents. In this regard, we will be accepting comments and suggestions related to the clarity, readability, and completeness of the information. Any feedback related to changing the legislation with respect to the SR&ED program is beyond the scope of this project and will not be considered.

Due to the large amount of documentation, we have divided the online public consultations into five phases. In each phase a set of draft policy documents will be posted on the SR&ED Web pages for 45 days (timeline below) and feedback will be sought from the public over that period. The public will be able to submit comments and suggestions directly to a dedicated email address ( After the 45-day consultation period, the draft policy documents will be removed from the SR&ED Web pages.

Note, we will evaluate each phase of the public consultations and refine the process and schedule as needed.

5. Consider public feedback

After each consultation period, we will review all the comments and suggestions received and we will revise the draft policy documents accordingly. We will consider all feedback in order to improve the clarity, readability, and completeness of the documents. However, we will not respond to individual submissions. 

6. Release the final policy documents

Once all the policy documents have been finalized, they will be organized and posted on the SR&ED Web pages. We expect to have this done by December 31, 2012

To ease the transition to the new format, we will keep both the current and the new policy documents on the SR&ED Web pages for six months. After that time, those publications whose content has been captured in the revised documents, and are therefore no longer needed, will be archived. All other necessary documents (for example, claim forms, guides, and brochures) will be retained. It is important to note that the current SR&ED policy documents and related guidance documents will remain in effect while the project is under way.

If you are interested in participating in the public consultations, please subscribe to our Electronic mailing list – SR&ED Tax Incentives to receive notifications as to when each set of documents will be posted on the SR&ED Web pages for feedback.

Additional Information

More information about the SR&ED Policy Review Project is available at Questions and Answers – SR&ED Policy Review Project.


The following table provides the timeline for the public consultations:

Web consultation phase Expected posting date Documents related to scientific topics Documents related to financial topics Documents related to scientific and financial topics
1 Fall 2010 none
  • SR&ED Filing Requirements
  • Third-Party Payments
2 Winter 2011 none
  • SR&ED Salary or Wages
  • SR&ED Shared-use Equipment
  • SR&ED Capital Expenditures
  • SR&ED Lease Expenditures
3 Spring 2011 SR&ED eligibility
  • SR&ED Overhead Expenditures
  • Prescribed Proxy Amount
  • Contract Expenditures for SR&ED Performed on Claimant's Behalf
  • Assistance and Contract Payment
  • Traditional and Proxy Methods
4 Summer 2011 none
  • SR&ED Investment Tax Credit
  • Recapture of Investment Tax Credit
  • Qualified SR&ED Expenditures
  • Pool of Deductible SR&ED Expenditures *
  • SR&ED Claims for Partnerships
5 Fall 2011 none none
  • Materials for SR&ED
  • Experimental production and commercial production with experimental development
  • Prototypes, pilot plants, commercial plants, custom products, and commercial assets

* Includes the acquisition of rights in, or arising out of SR&ED

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