Canada Revenue Agency, SR&ED tax incentives
What is your SR&ED claim worth?
A Canadian-controlled private corporation earns a 35% investment tax credit on qualified SR&ED expenditures up to its expenditure limit, now $6 million. On $500,000 of qualified spending that is $175,000, fully refundable in cash for a qualifying CCPC. Enter your own numbers below.
What this is based on
- The basic ITC rate is 15% on qualified SR&ED expenditures. Most Canadian-controlled private corporations, and from tax years beginning after 15 December 2024 eligible Canadian public corporations, "may earn a refundable ITC at the enhanced rate of 35%" up to their expenditure limit (CRA).
- The expenditure limit is $6 million for tax years beginning after 15 December 2024 and was $3 million for tax years beginning before 16 December 2024 (CRA news and updates). The enabling legislation received Royal Assent on 26 March 2026.
- The taper follows the statutory formula in subsection 127(10.2) of the Income Tax Act: $6 million x [($60 million minus A) / $60 million], where A is nil if prior year taxable capital employed in Canada is $15 million or less, and otherwise the lesser of $60 million and the excess over $15 million (Income Tax Act). Taxable income does not enter this formula.
- Refundability is shown for a qualifying CCPC: CRA states the ITC earned at 35% on current expenditures is 100% refundable, and gives "40% refund of the ITC calculated at a rate of 15%" on expenditures above the limit. Whether your corporation is a qualifying corporation, and the 40% refundability of the 35% credit on capital expenditures, depend on tests we do not model here.
- This calculator assumes current expenditures, a stand-alone claimant and a full 12 month tax year. Associated corporations must share one limit through Schedule 49, and a tax year shorter than 51 weeks prorates the limit by days over 365 (subsection 127(10.5)(b)).
- Provincial and territorial R&D credits exist on top of the federal credit and differ by province. CRA notes they "may also be available, although they will reduce the expenditures you can claim for SR&ED". We publish no provincial rates: check your own province's programme.
SR&ED Claim Calculator is an independent information site operated by Ellul Solutions Ltd. It is not affiliated with the Canada Revenue Agency or any government body, and nothing here is tax or accounting advice. Rates, limits and the statutory formula are quoted from CRA and the Income Tax Act as read on the updated date shown; confirm them with CRA or your adviser before filing.
Federal SR&ED investment tax credit by expenditure level, 2026
Last updated
What a Canadian-controlled private corporation earns in federal SR&ED investment tax credit at each level of qualified expenditure, assuming prior year taxable capital under $15 million so the full $6 million expenditure limit applies. Provincial credits are extra and not included.
Computed with this page's calculator formulas from the CRA's published rates: 35% on qualified expenditures up to the $6,000,000 expenditure limit, 15% above it; refundable column is 100% of the 35% credit plus 40% of the 15% credit, the treatment CRA states for a qualifying CCPC. Rates and the limit read from CRA and from subsection 127(10.2) of the Income Tax Act on 15 August 2026. Figures in Canadian dollars.
| Qualified SR&ED expenditures | At 35% | At 15% | Federal ITC | Refundable, qualifying CCPC | Effective rate |
|---|---|---|---|---|---|
| $100,000 | $100,000 | $0 | $35,000 | $35,000 | 35.0% |
| $250,000 | $250,000 | $0 | $87,500 | $87,500 | 35.0% |
| $500,000 | $500,000 | $0 | $175,000 | $175,000 | 35.0% |
| $1,000,000 | $1,000,000 | $0 | $350,000 | $350,000 | 35.0% |
| $3,000,000 | $3,000,000 | $0 | $1,050,000 | $1,050,000 | 35.0% |
| $6,000,000 | $6,000,000 | $0 | $2,100,000 | $2,100,000 | 35.0% |
| $8,000,000 | $6,000,000 | $2,000,000 | $2,400,000 | $2,220,000 | 30.0% |
- A Canadian-controlled private corporation with $500,000 of qualified SR&ED expenditures earns a $175,000 federal investment tax credit at the 35% enhanced rate, refundable in cash if it is a qualifying corporation.
- The enhanced 35% rate applies only up to the expenditure limit, $6 million for tax years beginning after 15 December 2024, up from $3 million; expenditures above the limit earn the 15% basic rate.
- At $8 million of qualified expenditures the blended federal credit is $2,400,000, an effective rate of 30%, because the first $6 million earns 35% and the balance earns 15%.
Cite this page
“Federal SR&ED investment tax credit by expenditure level, 2026”, SR&ED Claim Calculator, https://sredclaimcalculator.com/ (updated 2026-08-15). Computed with this page's calculator formulas from the CRA's published rates: 35% on qualified expenditures up to the $6,000,000 expenditure limit, 15% above it; refundable column is 100% of the 35% credit plus 40% of the 15% credit, the treatment CRA states for a qualifying CCPC. Rates and the limit read from CRA and from subsection 127(10.2) of the Income Tax Act on 15 August 2026. Figures in Canadian dollars.
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Go deeper
Sourced, dated, kept current.
SR&ED tax credit rates: the 35% enhanced rate and the 15% basic rate
CRA's SR&ED investment tax credit is 15% basic and 35% enhanced for CCPCs up to the expenditure limit. Who gets which rate, and how much of each comes back as cash.
The SR&ED expenditure limit: $6 million and the taxable capital taper
The 35% SR&ED rate stops at the expenditure limit. It is $6 million, tapering to nil as prior year taxable capital rises from $15m to $75m. The statutory formula, worked.
SR&ED claim deadline: 18 months, Form T661 and Schedule T2SCH31
The SR&ED reporting deadline is 12 months after your return is due, so 18 months after year end for a corporation. What has to be filed by then, and why the date is hard.
The questions we get
How much is the SR&ED tax credit worth?
For a Canadian-controlled private corporation, 35% of qualified SR&ED expenditures up to its expenditure limit of $6 million, then 15% above it. $500,000 of qualified spending earns a $175,000 federal credit; $8 million earns $2,400,000, a blended 30%. Provincial credits are extra.
What is the SR&ED expenditure limit?
$6 million for tax years beginning after 15 December 2024, up from $3 million. It reduces as prior year taxable capital employed in Canada rises above $15 million and is nil at $75 million, under the formula in subsection 127(10.2) of the Income Tax Act.
Do I get SR&ED money back if my company has no tax to pay?
Often yes. CRA treats the 35% credit on current expenditures as 100% refundable for a qualifying CCPC, so a loss making startup can receive cash. Credit that is not refunded can be carried back 3 tax years or forward 20.
Are there provincial SR&ED credits as well?
Yes. CRA states that provincial and territorial R&D tax credits may also be available, and that they reduce the expenditures you can claim federally. Rates, refundability and caps differ by province, so check your own province's programme. We do not publish provincial rates here.
Can a public company claim the enhanced 35% rate?
For tax years beginning after 15 December 2024, eligible Canadian public corporations have access to the enhanced ITC, with their expenditure limit determined on a three year average of annual revenue rather than taxable capital. Before that the enhanced rate was for CCPCs only.
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