1. Invest in a digital camera and use it to take pictures of any modifications you make to your products. Dated photographs especially are invaluable to your claim.
2. Keep hard copies of electronic files. Don’t forget to keep hard copies of any and all important emails and documents – a lot of companies only store emails and other files on servers for less than a year, and these files can be essential to putting your claim together.
3. Use your existing tracking. Take your existing tracking method for the work you do, and modify it so that it counts the labour spent on SR&ED as well. If you don’t have any tracking yet, consider putting some in place. Remember, if you get reviewed, you will need to defend the work and time spent on any project.
4. Educate your team. Any employees that could potentially be involved in SR&ED projects should be familiar with the SR&ED program – what it is, what make a project eligible, etc.
5. If you can, file your claim with your taxes. Filing your claim within six months of your year end sends your claim on the fast track to be reviewed – typically, if you file after six months (but before the 18 month deadline) your claim will take longer to be reviewed.
6. Keep meeting minutes. Whether they are meetings in-person or over the phone, keep track of what was discussed, and what date this meeting occurred on. This evidence can be essential if you have an SR&ED review.
7. Don’t forget converting dollar amounts. Remember to convert all US dollar amounts to Canadian dollar amounts using the daily exchange rate, especially if the conversion is not specifically detailed in your documentation.
8. Keep SR&ED in mind when establishing contracts. Be mindful of the level of ‘risk’ assigned to each party involved. By committing the contractor to a fixed price without exclusion, the contractor inherits the right to claim SR&ED incentives on the work performed.
9. Keep all financial documents together. Any documents that will be used to put together the financial portion of your SR&ED claim (invoices, contracts, T4’s, time sheets, etc) should be kept in the same location, to prevent misplacing or losing the documents when it is time to prepare your claim.
10. Spend 5-10 minutes per week summarizing SR&ED activities. Spending time every week is preferable than leaving this portion until you need to prepare your claim for two reasons. First, it guarantees that you’re not going to forget some of the SR&ED projects that you’re working on (which could happen if your claim was prepared a year after you were working on it); second, it will seem like a lot less time spent on summarizing activities if you do it in small pieces, as opposed to doing a years-worth of summarizing all at one time.