Many Canadian businesses use more than one grant to fund the same project. This is often allowed, as long as you follow the rules. The main risk is claiming the same costs from two programs, which governments call double-dipping. If this happens, you might have to repay funding or lose eligibility for future grants. The good news: with careful planning, you can legally combine federal and provincial grants.
Double-dipping happens when two government programs reimburse the same eligible expense. This rule applies to almost all federal and provincial grants, contributions, and tax credits.
Key things to remember:
Governments also look at your total government assistance (TGA). If the combined support goes over the allowed limit, one funder will reduce its payout.
You need to plan carefully to combine grants successfully. Grant stacking is the legal way to do this, and it usually works in two main ways.
Assign different expenses to different funders.
Example:
As long as each expense is claimed only once, this is allowed.
Many programs set a cap on how much government funding you can receive.
Typical caps:
Check each program’s guidelines for details.
The Scientific Research and Experimental Development (SR&ED) Tax Incentive Program often confuses applicants.
You can combine SR&ED with:
But you must follow a key rule.
If you get a government grant for R&D costs, you must reduce your SR&ED claim.
Example:
This is required by CRA rules.
SR&ED FAQs confirm that government assistance must be subtracted before claiming credits.
Use a simple spreadsheet or accounting software to list:
This helps you during audits.
Most applications ask:
“Have you received or applied for other government funding?”
Always answer honestly and explain how costs are split. Not disclosing can lead to clawbacks.
Some grants pay after costs are incurred, others pay upfront. Timing does not change the double-dipping rule. What matters is which program ultimately covered the expense.
Tools like GrantHub’s eligibility matcher can help you filter programs by province and industry and spot stacking rules early.
Claiming the same wage cost twice
This is the most common audit issue, especially with R&D salaries.
Ignoring stacking limits
Even if costs are different, total government support may still go over the allowed percentage.
Forgetting to adjust SR&ED claims
Grants that fund R&D must reduce your SR&ED-eligible amount.
Assuming tax credits don’t count as funding
Tax credits are government assistance and count toward stacking calculations.
Q: Can I use both federal and provincial grants for the same project?
Yes. You can fund one project with several programs as long as each expense is only claimed once and total funding stays within the allowed limits.
Q: Are tax credits treated the same as grants?
Yes. Federal and provincial tax credits are government assistance and must be disclosed and coordinated with grants.
Q: What happens if I accidentally double-dip?
The funder can reduce your payment, ask for repayment, or limit future eligibility. Fixing the issue early usually reduces penalties.
Q: Does SR&ED prevent me from getting other grants?
No. You can still receive grants, but any R&D funding must be deducted from your SR&ED-eligible costs.
Q: Can I use one grant as my matching funds for another?
Usually no. Most programs require matching funds to come from non-government sources unless the guidelines say otherwise.
You need to plan carefully to combine grants successfully. When you organize your expenses and disclose all funding sources, stacking federal and provincial grants can stretch your budget further. GrantHub tracks hundreds of active grant programs across Canada—see which ones match your business profile and how they can work together.
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