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As Q2 of 2023 begins to hit its full stride, R&D-based businesses in Vancouver, Montreal, and Toronto are actively looking to enhance their capital stack and secure viable funding to extend their financial runway through the end of the year. With the Government of Canada introducing new tax incentives for Clean Tech and Clean Hydrogen, 2023 is an excellent year to explore available government tax credits, including the Scientific Research and Experimental Development (SR&ED) Program.
Designed to alleviate some of the financial concerns resulting from innovation and development, the SR&ED program is extremely valuable to startups and R&D companies across Canada. Venbridge is proud to partner with successful SR&ED applicants to help you bridge the gap between an accepted application and receiving your funds, which can often take weeks, or even months, to arrive. As a trusted lender, we’ve helped countless companies fund their operations and keep the push for R&D moving forward. Below, we’ll address some of the most commonly asked questions about SR&ED and partnering with a venture debt financed like Venbridge. Read on to learn more!
FAQS About the SR&ED Program
If you plan on applying for SR&ED in 2023, you’ll want to be aware of the following frequently asked questions:
Who is Eligible for SR&ED?
For projects to be SR&ED-eligible, they must meet the following three criteria:
- Scientific or technological advancement
- Scientific or technological uncertainty
- Scientific and technical content
Applicants and work must be Canada based in order to qualify.
What is the Cut Off For SR&ED Applicants?
SR&ED applicants have up to 12 months after the filing due date of their income tax return.
Does a Prior Review Reduce My Chance of Financing?
No. Generally speaking, a prior review actually reduces risk and can lower your interest rate. With that being said, if your adjustment rate is relatively high, it may affect the size and cost of your loan.
How Long Does it Take to Receive Money from the SR&ED Program?
One of the biggest challenges when it comes to receiving government funding from SR&ED is that it can take weeks or even months or your funds to arrive. SR&ED financing through a trusted lender like Venbridge can alleviate the concerns caused by waiting periods and give you access to capital when it matters most.
Financing with Venbridge
Do You Have a Minimum/Maximum Loan Amount?
Venbridge has no official “minimum” or “maximum” loan amount; however, we do not typically deal with tax credits, grants, or refunds below $100K. For those seeking debt financing in excess of $2M, Venbridge does syndicate loans as necessary.
Can I Continue Working With My Current SR&ED Consultant?
Yes. We recognize the value of building solid relationships with trusted consultants and are happy to work with your provider to track SR&ED projects throughout the year.
Do You Work With First Time Applicants?
Typical speaking, Venbridge does not finance first-time SR&ED claimants. However, if you have undergone a corporate restructuring, are a spin-off starting out, or have a venture capital investment, we most likely will be able to provide you with financing.
Do You Provide Financing Outside of Canada?
No. At this point in time, Venbridge partners with CPCs (Canadian Controlled Private Company) exclusively.
Financing Your SRED Refund With Venbridge
Venbridge is proud to partner with Canadian innovators and SR&ED applicants to ensure you have capital you can depend on when it matters most. Having reliable access to venture debt solutions like those offered by Venbridge allows you to continue R&D efforts with confidence and avoid the pain points associated with wait times. If you have a minimum of $130k on your SRED claim and one year of filing history, our accelerated due diligence process can give you access to the funding you need to grow your company in as little as 2 business days.
Learn how we can partner with your team to enhance your R&D initiatives through venture debt lending by contacting our team today!
Want to calculate how much your potential SRED tax credits are? Use our free online tool here!
