Modular Unit Fabricator previously told there was no SR&ED.

This innovative company develops and manufactures residential, commercial and industrial modular units – specializing in customized units for the mining and marine industries. Founded over 20 years ago, this company has become a leader in the modular unit fabrication industry.

Six years ago, this company brought in an external consultant to put together an SR&ED claim. After a pre-review by a CRA representative, both the representative and the external consultant concluded that this company’s projects were not eligible for the SR&ED program. This company had not thought about claiming for the SR&ED program since.

Changes over the Years.

A lot of changes were made by this company in the past few years to improve their products and processes. There have been many customized projects which required them to work on experimental development for new jobs. They had to expand their facilities in order to keep up with the demand for their products. As well, there have also been modifications to their assembly process to make the time spent on assembly more efficient. Many situations where there are changes to products and processes include SR&ED-eligible activities, whether you’re looking for them or not.

Another Look at the SR&ED Program.

This company isn’t the only thing that has been changing. The way in which the SR&ED program is run has undergone changes as well - the new claim review manual has been implemented among other changes resulting in reviews that are more consistent across the board.

NorthBridge met with this company, and discovered that the company, although previously under the belief they would not qualify for the SR&ED program, did actually have a lot of SR&ED projects. NorthBridge worked with this client to uncover SR&ED projects they did not realize existed, and put together a claim in a short time-frame to meet the filing deadline.

Claims Accepted as Filed

This company has now worked with NorthBridge for two SR&ED filings – after desk reviews done by the CRA, both submissions were accepted as filed. The refunds that were received have been used to reinvest into their business, through the development of new products and establishment of new technologies.

"At Kidzpace, we had never claimed under the SR&ED program before coming into contact with Northbridge. They were able to help us not only with the project identification and filing process, but also aided us with the claim during Technical and Financial reviews. Working with Northbridge allowed us to claim expenses for development work which would have otherwise been lost, allowing us to receive a significant refund for our efforts. This has enabled us to continue to invest in our growth through research and development and the SR&ED program."
- Rob Butler – CEO, Kidzpace Interactive Inc.

Position SR&ED Team Specialist
Years working in industry 4
Educational background Bachelor of Engineering in Electrical Engineering
Professional Memberships and Designations APENs (EIT)
Hobbies/Interests Brazilian Jiu Jitsu, Fitness, Nutrition
Biggest non-work-related accomplishment Placing first at a Brazilian Jiu Jitsu tournament in the advanced division..

Canadian Greenhouse Conference

Northbridge will be exhibiting and speaking at the Canadian Greenhouse Conference at the International Centre in Toronto October 6th and 7th. NorthBridge will have staff on hand to handle any questions you may have over the 2 days.

Dates to Remember

October 11th: Thanksgiving Monday
October 31st: April 2009 FYE claims due

Liberals Campaign Promises – New Brunswick Liberal Premier Shawn Graham has promised to help the forestry sector if their Liberal government is re-elected in September. They have endeavoured to maintain the $6 million annual silviculture budget to help people care for their private woodlots. The government will also encourage greater use of bio fuel from wood waste. Graham is promising to work with the forest industry and engineering companies to develop wood construction techniques and products for taller buildings. The election was held September 27th. NorthBridge will follow up with developments on these campaign promises in our next issue.

Canada Small Business Financing Program - Industry Canada

NorthBridge continues to bring you the latest updates and hot topics that are important to our clients. Some of our September highlights:

Dear NorthBridge,

We are a small start-up company looking for ways to recover some of the costs related to our new product development. We were recently introduced to the idea of claiming for SR&ED tax credits but are concerned about our eligibility due to the lack of formal tracking & reporting procedures. I know we have some activities that could qualify, but we don’t have formal R&D tracking procedures in place and it may be difficult to prove to the CRA that our work is eligible.
- A Concerned Business Owner

Dear Concerned Business Owner,

One of the requirements for submitting an SR&ED claim to the CRA is to provide detailed project descriptions outlining the technological advancements you were trying to achieve, the obstacles you encountered and the work you performed to overcome those obstacles. Often, the information provided in these project descriptions is enough to support your claim to the CRA.

In some cases, the CRA will require additional supporting information in order to process your claim. This will often consist of a visit to your workplace to review the additional documentation.

Often times, a claimant may have little to no formal SR&ED documentation systems to substantiate the work done – especially in the case of new start-up companies or first time claimants. However, the CRA understands that the absence of formal tracking procedures does not indicate that SR&ED did not take place, and should not discourage a company from filing. They do, however, encourage first-time claimants to set up formal tracking procedures for future claims.

Alternative ways to support the systematic SR&ED work performed can consist of (but are not limited to) any of the following:

Meeting minutes, Discussions or interviews, Emails, Notebooks, Technical Drawings, Test Records, Prototypes & Samples, New or Improved Products or Processes etc…

At NorthBridge, our team of SR&ED experts will work with you to determine your SR&ED-eligible projects, as well as assist in the preparation of the technical descriptions of the work you performed for the submission of the prescribed claim forms. We will help you identify and gather supporting documentation required to defend your claim and will also work with you to set up formal tracking systems for future claims. Call us today for a free consultation.