Every year, Canadian businesses that are clearly doing eligible R&D never file an SR&ED claim — usually because of a handful of persistent misconceptions about what the program actually requires. Here are five of the most common.
Myth 1: “We’re not a tech company, so we don’t qualify.”
SR&ED is defined by the nature of the work, not the industry label on your website. Manufacturers, construction firms, food producers, and agricultural operations file successful claims every year when their work meets the eligibility test.
Myth 2: “Our project failed, so there’s nothing to claim.”
A failed experiment that generated new technical knowledge — about what doesn’t work, why an approach broke down, or what limits exist — is often exactly the kind of work SR&ED was designed to reward.
Myth 3: “We didn’t build something brand new, so it doesn’t count.”
SR&ED covers improvements to existing products and processes, not just inventions from scratch. The question is whether the improvement required resolving genuine technological uncertainty.
Myth 4: “We don’t have a dedicated R&D team.”
Eligibility is tied to the activity, not the org chart. A two-person team solving a technical problem as part of their regular job can still generate an eligible claim.
Myth 5: “We only qualify if we hire a specialist to write the whole claim from scratch each year.”
Documentation built during the year — not reconstructed after the fact — produces the strongest claims and the least work at filing time. A specialist helps interpret and package the claim; they can’t manufacture evidence that doesn’t exist.
