How to claim

To claim SR&ED expenditures a corporation or an individual carrying on a business must file an income tax return and include a completed Form T661. Use Form T661 to provide technical information and to calculate the qualified SR&ED expenditures used for the investment tax credit.

Your business may also be eligible for one or more of the provincial and territorial R&D tax credits; see the Summary of provincial and territorial research & development (R&D) tax credits for more information.

How individuals can claim the SR&ED tax incentives

To claim SR&ED expenditures and the investment tax credit, with your income tax return, file completed:

• Form T661
• Form T2038, Investment Tax Credit

You can report the SR&ED expenditures and investment tax credit no later than 12 months after your business income tax return is due. For more information on the SR&ED reporting deadlines see the SR&ED Filing Requirements Policy.

How corporations can claim the SR&ED tax incentives

To claim SR&ED expenditures, with your income tax return, file completed:

• Form T661
• Schedule T2SCH31, Investment Tax Credit

You can report the SR&ED expenditures and investment tax credit no later than 12 months after your corporation’s income tax return is due. For more information on the SR&ED reporting deadlines see the SR&ED Filing Requirements Policy.

Instructions to help complete the form

Use the T4088 Scientific Research and Experimental Development (SR&ED) Expenditures Claim - Guide to Form T661 for clear instructions to help you fill out the form.

The guide has 10 parts grouped into 5 components:

General information

• Part 1: Fill out your identification and contact information.

Project information

• Part 2: Provide details about the scientific or technological content of your work. Fill out a separate Part 2 for each project you are claiming.

Financial information

• Part 3: Calculate the amount of your deductible expenditures for the purpose of calculating your net income.
• Part 4: Calculate the expenditures that qualify for your investment tax credit.
• Part 5: Calculate your overhead and other expenditures if you chose the proxy method.
• Part 6: Break down the costs for each project you are claiming in the year.

Statistical information

• Part 7: This information helps the Government develop statistics about the type of research and development done in Canada.
• Part 8: Go over the checklist in Part 8 to make sure that your claim is complete before filing it.

Certifications

• Parts 9 & 10: Provide information about your claim preparer and sign Parts 9 and 10 to certify that all your information is true, correct and complete.