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February, 2009
 

A Northbridge Success Story

Manufacturer Incurs Heavy Development Costs

A mattress manufacturer had spent the last few years developing new products to meet changing market trends and materials. New processing techniques and new materials had to be explored and tested, in order to meet specifications of longevity and improved performance of traditional mattress construction.

This proved to be a very costly undertaking, as many people became involved in trials. Many types of materials had to be tested and evaluated over the course of two years. These costs directly affected the bottom line profits, however it was simply accepted by the manufacturer that this was necessary in order to develop new products.

Northbridge Identifies Vast SR&ED Potential

When Northbridge pointed out that most of these costs could be recovered through the SR&ED program, it was greeted with great skepticism by the manufacturer. Claiming for SR&ED was unheard of in this industry at the time. Northbridge Consultants went to work, and soon found quite a number of activities that would qualify. The process of assembling documentation and filing a solid claim was begun.

Claim Reviewed... and Approved

The claim was approved, to the surprise of the owner. Northbridge Consultants were able to identify, document, and defend all eligible SR&ED activities claimed for.

Significant Return Received, Company Thrives

The mattress manufacturer thus received a very significant return from the CRA.

Through the funds recovered, a new facility was opened. Sales and profits increased dramatically from the new products in which they invested so much to develop. The company continues to develop new, cutting edge products, to grow, and prosper.

* This is a factual account of a client’s success with Northbridge Consultants.

 

Vision Statement

To be the premier consulting partner for Canadian businesses by offering personalized services that support client and corporate goals. Our top priority is to fulfill the client's needs through the delivery of service excellence, professional expertise and reliability, the preservation of the utmost integrity, and the passionate encouragement of teamwork and employee development.

Ask The Experts

Dear Northbridge Consultants,

I work for a manufacturer serving the automotive industry. Our company has filed for SR&ED twice now. Our first return was a decent amount, but was not as high as we think it could have been. The most recent claim was rejected, and the CRA cited inadequate documentation, mainly, the narratives apparently did not clearly define the necessary requirements of technical uncertainty and advancement. Our projects were deemed ineligible.

The claim was put together and taken care of in-house. I feel certain that the activities we claimed are, in fact, qualifying. In this bad economy, we can use every extra bit of funding possible. Can I appeal the results of the claim? How can we better our success with SR&ED in the future? My employer is now starting to feel that our time and effort is not worth the hassle.

Sincerely,
John McDonald.

Dear Mr. McDonald,

If the 18 month period after your fiscal year end claimed for has not expired, you can submit an objection within 90 days of receiving your notice of assessment. If you are able to argue that the projects did in fact meet the SR&ED requirements, it may very well be worthwhile to pursue an appeal. You can find more information about your options and the appeals process by visiting www.cra-arc.gc.ca/txcrdt/sred-rsde/pblctns/p2000-02r-eng.html#3.2.

It is important to have a solid technical narrative, and this is proving more of a challenge now that you are limited to the number of words that your descriptions can contain under the new filing guidelines. This is where having a consultant to assess projects and file for you can be extremely valuable. Self-preparation can often increase the risk of claim rejection. Feel free to contact us for further assistance.

Have a question for the experts? Submit your inquiry to info@northbridgeconsultants.com.

For Our Valued Clients

Northbridge takes pride in maintaining an unmatched level of customer service to our clients. Our account managers are evaluated based on client feedback – please complete our survey to let us know if Northbridge Consultants met or exceeded your expectations, as well as how we can improve our service to you.

 

Mission Statement

Northbridge provides results oriented consulting services through the development of adaptable and innovative business solutions for firms operating in Canada.

Recent and Upcoming Events

On Friday, March 6th 2009, Northbridge Consultants will be holding another free breakfast seminar, to provide a useful information session on the SR&ED program. The seminar will be held at the Waterloo Inn Conference Hotel. Details can be found on the back cover of this newsletter. Please note that if you wish to attend, it’s best to RSVP as soon as possible as the seating will be limited.

On January 29th, Northbridge held a SR&ED seminar in Cambridge at the Cambridge Hotel and Conference Centre. The event was a success, and these seminars will be held on a regular basis.

Couldn’t make it to our last one? Perhaps you’ve been trying to learn about SR&ED from a CRA seminar, but they are so often booked full well in advance. Contact us to reserve a spot to future events.

You can reach us via email at info@northbridgeconsultants.com or by phone at (519) 623-2486.

Of Special Interest

Urgent Note Regarding New T661 Form

On November 10, 2008, a new T661 form was released by the Canada Revenue Agency to streamline the SR&ED claim filing process. For tax years ending after December 31, 2008, the CRA will only accept the new version of the T661 form. If you are a client of Northbridge Consultants, this need not affect you too much - they take care of the T661 forms and the claim submission for you!

For more information, contact us or visit one of the following:
 

Tips & Tricks

The CRA has launched a new SR&ED Eligibility Self-Assessment Tool to determine if the R&D work you have performed has a probability of meeting the SR&ED requirements. We have listed some of the assessment questions to assist in determining, if your work, may be qualified:

  1. Are you carrying on a business in Canada?
  2. Was the R&D work performed on this project related to the business you were carrying on in Canada?
  3. Was the R&D work on this project performed in Canada?
  4. On this project, were you attempting to develop a new, or improve an existing material, product or process?
  5. Did the work you performed attempt to achieve a technological advancement?
  6. Did you have to overcome technological obstacles to achieve your technological advancements?
  7. Did you conduct a systematic investigation through experimentation or analysis to overcome the technological obstacles encountered?

Should you have answered “yes” to the majority of the above questions, your R&D work may be qualified for SR&ED Investment Tax Credits. Should you wish to review the Assessment Tool in detail please go to the following address: www.cra-arc.gc.ca/txcrdt/sred-rsde/ssssmnt/menu-eng.html

Northbridge Facts & Figures

  • Full-service SR&ED consulting firm with 20 years of experience.
  • Northbridge currently submits hundreds of claims annually.
  • 18 full-time technical and financial staff, including 6 new hires
  • Portfolios include clients from across Canada.
  • Partnered with respected manufacturing associations, accounting firms and industry experts.

Of Special Interest:

  • Companies with an August year-end only have until February 2009 to file their 2007 claim.

New Facts & Figures:

  • Federal and Provincial government budgets indicate $5.9 billion of annual SR&ED funding
  • 50% of earned Investment Tax Credits continue to be from the Manufacturing sector
  • Small & medium sized businesses submit 75% of SR&ED claims

SR&ED Breakfast Seminar

Free SR&ED Breakfast Seminar

You are invited to attend our educational and informative breakfast seminar!

Come and enjoy a free catered breakfast buffet, compliments of Northbridge Consultants.

Are you familiar with the SR&ED claims process? Northbridge Consultants can offer the guidance and full customer service from start to finish to make filing an SR&ED claim incredibly rewarding for your business.

Did you know that you can collect hundreds of thousands of dollars back from government tax incentive program?

It’s called SR&ED: Scientific Research & Experimental Development, and you can collect significant returns from the Canada Revenue Agency for your innovations and developments.

Whether you’ve never filed, or have submitted past SR&ED claims and received returns before,
the information and expertise that Northbridge has to offer could greatly benefit your company.
This seminar is of no cost to you, but the information you will receive is invaluable!

Friday March 6th, 2009
The Waterloo Inn & Conference Hotel
475 King Street North • Waterloo, ON

Breakfast: 8:00 a.m. - 9:00 a.m. • Seminar Presentation: 9:00 a.m - 11:00 a.m.
* We will stay after the presentation is over for you to approach us with any questions you may have.

For more information, or to register with your name, company name, and number of attendees, contact:
Ashley Demers: ashley@northbridgeconsultants.com or (519) 623-2486 ext. 231

*If you wish to attend, please confirm your attendance by no later than March 3rd, 2009. Seating is limited, so RSVP soon!

Northbridge Consultants 70 Cowansview Rd Cambridge ON N1R 7N3 T:519.623.2486 F:519.623.5654

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Terms of Use: Although we endeavor to ensure timely and accurate information throughout this newsletter, it is not intended to be a definitive analysis of legislation cited, or a substitute for professional advice. Readers are encouraged to seek professional advice when attempting to relate their specific situations to information disclosed within.