What exactly is “Open Source”?
The open source production model is a model where the source materials for the end products are available to the public.
In the case of software, where this term is mostly heard, it means that the source code of the software is available for others to view – this has been used in many cases to help with further development or debugging of software. Some open source software that you may have heard of, that you may even use, include Mozilla Firefox, OpenOffice, Linux and Drupal.
There is also open source electronics hardware, robotics, food & beverage products, and fields in both the medical and science industries.
The medical and science industries are slightly different than the other industries listed. Open Source proposals in the pharmaceutical industry have lead to the formation of the Tropical Disease Initiative, whose purpose is to discover new drugs that work against tropical diseases such as Malaria or Tuberculosis. In the science industry, open source initiatives have resulted in the creation of the Science Commons – a project that works to speed the translation of data into discovery, and increase the value of research.
How would this affect applying for SR&ED?
What you have to remember, if you are using open source technology is that when claiming for SRED, the work you are claiming must be for developing new or improving existing products, processes or services, where you have gone beyond the existing technological baseline. After you have completed the work, you know more about the technology than was previously generally accepted as the baseline of knowledge.
With many companies taking advantage of open source materials, it means that innovation can happen more quickly than it had in the past, and that smaller companies can do the innovative work – not just the large corporations, as it had been in the past.
An example of where work done on open source materials that could be applicable for the SR&ED program include the creation of new algorithms, methods or processes for open source software. If you are building on top of open source software with other widely known technology, this would not be eligible for the SR&ED program.
Whether what you are doing in regards to open source materials is in face eligible or not for the SR&ED program depends on exactly what you are doing with the open source materials. The best way to discover whether what you are doing is eligible for the SR&ED program is to contact an expert in the program.