Tax credit for R&D labour costs

For Québec-based companies investing heavily in research and development, labour costs can quickly become one of the biggest barriers to innovation. The Tax Credit for R&D Labour Costs was designed to ease that pressure by helping businesses recover a portion of salaries and related compensation tied directly to scientific research and experimental development work carried out in Québec. Administered through Revenu Québec, this tax credit has supported companies across a wide range of industries, from technology and manufacturing to life sciences and engineering.

This measure applies to eligible R&D projects performed by a company’s own employees or through certain third-party arrangements, with the credit calculated as part of the corporate tax return rather than as a grant paid upfront. While the amount of support varies depending on the scope and structure of each project, it has historically represented meaningful, non-repayable relief for businesses committing resources to innovation. It’s also worth noting that this specific R&D labour tax credit has been phased out for newer fiscal years, and is only available to companies whose taxation year began before spring 2025. Businesses with later start dates may need to look at Québec’s newer R&D and pre-commercialization tax incentives instead.

Because tax credits can be complex and timing-sensitive, understanding how this program applies to your situation is key. Reviewing the full details through GrantHub can help you determine whether this credit, or a successor program, fits your R&D strategy.