If your business does R&D in Canada, the federal Scientific Research and Experimental Development (SR&ED) program is only part of the picture. Most provinces offer their own R&D tax credits that you can claim in addition to SR&ED, as long as you follow the coordination rules. For Saskatchewan-based companies, using both credits together can reduce your after-tax R&D costs by up to 60% for eligible expenditures each year.
This guide explains how provincial R&D tax credits work with federal SR&ED, with a practical focus on the Saskatchewan R&D Tax Credit.
SR&ED is a federal program. It supports eligible R&D work through investment tax credits (ITCs) on qualifying expenditures such as salaries, materials, and some overhead.
Provincial R&D tax credits are separate programs. Each province sets its own rates, refundability rules, and eligible costs. You usually claim them through your provincial corporate tax return, not through CRA alone.
Key coordination principle:
This prevents you from claiming the same expense twice.
The Saskatchewan R&D Tax Credit is designed to complement federal SR&ED, not replace it.
Most costs that qualify for SR&ED also qualify for the Saskatchewan credit, such as R&D wages and related expenses in Saskatchewan.
Here’s a simplified example:
You get significant support from both credits, but only if you claim them the right way.
Tools like GrantHub’s eligibility matcher can help you filter programs by province and industry in seconds. This is helpful when you operate in more than one province.
While Saskatchewan is the focus, it helps to know how other provinces approach coordination.
The rules differ, but the principle stays the same: provincial credits reduce the SR&ED expenditure base.
Understanding timing helps avoid reassessments.
Most R&D tax credits, including Saskatchewan’s, follow your corporate tax filing deadline, typically six months after your fiscal year-end.
Provincial R&D credits must reduce your SR&ED pool. Missing this adjustment can trigger CRA reviews.
Credit rates, refundability, and eligible costs vary widely. Saskatchewan’s 10% refundable credit for CCPCs is not universal.
Only R&D performed in Saskatchewan qualifies for the Saskatchewan credit, even if your company is registered there.
Late planning limits your ability to structure projects, payroll, and documentation correctly.
Q: Can I claim SR&ED and the Saskatchewan R&D Tax Credit on the same project?
Yes. You can claim both on the same R&D project, as long as you coordinate the expenses and reduce your SR&ED claim by the provincial credit amount.
Q: Is the Saskatchewan R&D Tax Credit refundable?
It is refundable for Canadian-controlled private corporations. For other corporations, it is non-refundable and can only reduce taxes payable.
Q: Do I need separate documentation for provincial R&D credits?
Yes. While there is overlap with SR&ED records, provinces may request their own schedules, payroll records, and proof the work was done in-province.
Q: What happens if I operate in multiple provinces?
You may be eligible for more than one provincial R&D credit, but only for expenses incurred in each province. Coordination with SR&ED becomes more complex.
Q: Can partnerships or sole proprietors claim the Saskatchewan credit?
No. The Saskatchewan R&D Tax Credit is available to corporations only.
Provincial R&D tax credits can make your SR&ED claim go further, but only if you plan them together. GrantHub tracks hundreds of active grant and tax credit programs across Canada — check which ones match your business profile before you file.
See also:
Getting this right early keeps more cash in your business and lowers your audit risk later.
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