What expenses are eligible?
Claimants can apply for SR&ED investment tax credits for expenditures such as wages, materials, machinery, equipment, some overhead, and SR&ED contracts.
From the CRA's brochure Refunds for Small Business R&D:
"You can claim many of the costs incurred for SR&ED during your fiscal year. These costs may include:
- wages for staff doing the SR&ED work
- costs of materials used in performing SR&ED
- costs of new machinery and equipment purchased for SR&ED
- costs of SR&ED contracted out
- lease costs (excluding building leases, or rent)
- third-party payments to organizations such as universities and colleges
- certain overhead costs related to SR&ED, or a proxy for these costs
Some work does not qualify, such as market research, research in humanities or social sciences, quality control and work done outside of Canada."