Northbridge Consultants is the industry leader in maximizing monetary gains for Canadian Businesses through the Federal SR&ED Program. We accomplish this by identifying more SRED-eligible projects, and by supporting our clients every step of the way (from the time we first tour their facilities, through the preparation of all necessary documentation, right up until the CRA Reviews are completed). This approach has lead to a one hundred percent acceptance rate for claims we have prepared during our twenty-five year history, and our clients typically receive ninety-five percent of the amount submitted on their behalf.

In addition to SR&ED Tax Credits Canadian Businesses can also obtain funds in advance of their projects. The National Research Council provides funding for activities that generate new employment in the technology or science fields through their IRAP Program. Generally, fifty percent of project labour costs are provided. In special circumstances costs for equipment, studies, lab fees, specialized materials and contractor fees are also funded.

Another federal program available to Canadian Industries is the ecoENERGY Retrofit Incentive. This program encourages businesses to modify buildings, equipment and systems through upgrades to reduce the facility’s energy use. The program provides up to twenty-five percent of project costs to a maximum $50,000 per application. Using energy more efficiently helps industries to be more competitive and reduces greenhouse gas emissions and air pollution leading to a cleaner environment for all Canadians.

Your Northbridge Account Manager will assist you in understanding NRC Programs, and how they can be utilized in conjunction with your SR&ED Tax Credit claim.

Back in March, when the Provincial and budget was announced, it was revealed that the PST and GST would be combined to form the Harmonized Sales Tax (or HST) in Ontario. When it was first announced that Ontario will be switching over to this system, I will admit that I was a little perturbed about it, as it means that the HST will be substituted for items that don’t even have PST on them – such as gas. But what does it mean for businesses? Well, there are some good points as well as some bad ones.

On the negative side, you’ll have to pay 15% tax on items that you did not have to pay for before – such as heating, gas, water, building repair services, plumbing… the list goes on. This means that, yes, we will have to pay more for some items than we previously had to.

There are, however, some good things that businesses can expect to see. Businesses will be able to use input tax credits for HST – so not all of the money a business collects as tax from a customer has to go to the government.

Similar to what businesses did previously with the GST, they will be able to deduct the HST paid on products and services that business purchases in order to run any commercial operations. Due to this, on average most businesses will end up paying less taxes, and theoretically the money that is going through the economy will be taxed less often than it had been previously.

It is also expected that this will result in Ontario becoming more attractive to investors due to these tax credits and rebates.

Ontario is not the only province to have HST instead of GST – currently, the Atlantic provinces have already been using it for a few years. When the harmonized taxes were introduced into the Atlantic provinces, they found that there wasn’t really much of a change as far as business goes – for example, it did not lead to more outsourcing, which is one of the concerns people in Ontario cite. As well, small and medium sized businesses found that the HST was more helpful to them than having to pay both taxes.

So what does this mean for you? Well, as a consumer it still appears that we get the short end of the stick, but if businesses can benefit as much as we’re told they will, then perhaps in this economy it’s not a bad thing.

If you do have any comments that you want to leave the McGuinty government, you can do so through their website.

The Industrial Research Assistance Program that the National Research Council of Canada has (NRC-IRAP) has long been of assistance to companies in Canada who need funding for research purposes. About a month ago, NRC-IRAP announced a new review process: the Small Project Accelerated Review Process.

This process was designed to help grow the business of SMEs in Canada – help small and medium sized businesses not just with R&D efforts, but with market research or process changes that will help benefit and grow your company.

What does this mean for you?

Quite simply, if you are a small or medium sized business, and are only doing a project that requires a maximum contribution of $50,000 from NRC-IRAP then the NRC-IRAP has created a streamlined process to get you your funding FAST.

So what kind of projects are acceptable for the accelerated review process?

• R&D projects that are limited in scope and nature
• Lean manufacturing/productivity studies
• Prototype engineering
• Development of business plans
• Branding creation and enhancements
• Market research studies

There are of course a lot of other types of projects acceptable for the review process, but this is just a small selection to give you an idea of the great variety there is that is applicable. You can get more information about this new funding process here.