IRAP Eligibility: Who Can Apply to NRC IRAP Financial Assistance
The Industrial Research Assistance Program (IRAP) — delivered by the National Research Council of Canada (NRC IRAP) — provides financial assistance to help Canadian small and medium‑sized enterprises undertake technology‑driven research and development and move innovations toward commercialization. If your organization is exploring Canada innovation funding for SMEs, this IRAP eligibility guide explains who can apply, what conditions must be met, and how NRC IRAP evaluates fit. As of December 1, 2025, IRAP funding remains a leading federal option for R&D support, including technology innovation projects and youth employment initiatives.
In this article, you will find clear, practical information on IRAP eligibility criteria, size and geographic requirements, project and activity expectations, financial and operational conditions, ineligible applicant types, and common edge cases. We also include a self‑assessment checklist to help you quickly determine whether pursuing IRAP funding is appropriate before you contact an Industrial Technology Advisor (ITA) at NRC IRAP.
Program Overview
NRC IRAP supports Canadian SMEs that are pursuing technology‑driven innovation with strong commercialization intent. The program can provide non‑repayable contribution funding for eligible R&D activities and, in certain streams, wage subsidies for youth employment. In recent years, NRC IRAP has been mandated to support larger innovation projects with increased contribution thresholds — in select cases up to $10 million — for firms with potential for rapid, significant growth and transformative impact in Canada.
Key points to understand:
IRAP is a federal contribution program, not a tax credit. Funding is typically provided on a reimbursement basis against approved, eligible costs.
Support is focused on R&D and technology innovation projects that lead to new or improved products, processes, or services developed and commercialized in Canada.
The program is delivered through regional networks of ITAs who assess fit, guide applicants, and monitor projects.
Intake is continuous rather than a single annual deadline; however, funding depends on budget availability and program priorities.
This article focuses on who can apply — that is, the organizational and project characteristics NRC IRAP looks for at the outset.
Applicant Type Requirements
To be considered for IRAP funding, applicants generally must meet baseline organizational criteria. At a minimum, your organization should:
Be a for‑profit, incorporated business in Canada.
Be a small or medium‑sized enterprise (SME) with 500 or fewer full‑time equivalent (FTE) employees.
Have a clear plan to grow and generate profit by developing and commercializing technology‑driven innovations in Canada.
Operate with management and technical capacity capable of executing an R&D project.
Important clarifications:
Incorporated in Canada: IRAP funding is intended for Canadian corporations. Sole proprietorships and general partnerships typically do not qualify until they incorporate. If you are in the process of incorporating, confirm timelines with an ITA before investing effort in a proposal.
Profit orientation: While social impacts are welcomed, IRAP is designed for businesses that intend to generate revenue and profits from the innovation. Non‑profit organizations are generally not eligible as lead applicants for IRAP contribution funding.
Operational capability: NRC IRAP assesses whether your team has the business leadership, technical personnel, and governance to deliver the proposed R&D. Strong management résumés and relevant technical CVs help demonstrate readiness.
If your organization fits the above, consider preparing a concise business plan or pitch deck, up‑to‑date financial statements, and management/technical résumés to support preliminary discussions with NRC IRAP.
Size & Scale Criteria
IRAP targets SMEs. The standard size requirement is:
500 or fewer FTE employees at the time of application.
Additional considerations:
Early‑stage startups are eligible if incorporated and able to demonstrate credible commercialization plans and sufficient capacity to undertake R&D. Pre‑revenue is not an automatic barrier, but you must show technical feasibility, milestones, and a path to market.
Scale‑ups approaching the 500‑employee threshold remain eligible, including firms expanding in advanced manufacturing, software/SaaS, cleantech, medical devices, agtech, AI/ML, robotics, and other innovation‑intensive sectors.
For select high‑potential firms identified by NRC IRAP, larger projects may be considered under elevated funding thresholds. These cases require strong evidence of rapid growth potential and significant benefits to Canada.
Geographic Eligibility
IRAP is a national program. To qualify:
Your business must be incorporated in Canada and carry out the majority of the IRAP‑funded R&D work in Canada.
Projects can involve multi‑province teams and cross‑regional collaborations. NRC IRAP has ITAs across provinces and territories to support applicants.
Provincial notes:
Quebec: IRAP eligibility applies fully in Quebec. Many Quebec SMEs layer IRAP with provincial programs (e.g., innovation grants or tax credits) where stacking rules permit. Plan your funding mix carefully.
Ontario and British Columbia: Strong ecosystems exist for software, AI, life sciences, and clean technology. IRAP projects often involve subcontractors or research partners; ensure Canadian value creation remains central.
Prairies and Atlantic Canada: IRAP is active across manufacturing, agtech, ocean tech, and energy transitions. Regional priorities may inform project assessments but do not change the federal eligibility baseline.
Northern Canada: Projects are possible where SMEs and qualified technical teams are based or where work can be executed effectively in Canada.
If elements of the work occur outside Canada (e.g., specialized testing unavailable domestically), discuss constraints with your ITA early and document why the activity is essential to Canadian commercialization.
Project & Activity Requirements
Eligibility is not only about the applicant; the proposed activities must also fit IRAP’s mandate. Generally, NRC IRAP looks for:
Technology‑driven R&D that advances the state of the art for your company and supports a defined technical objective.
Structured project plans with milestones, deliverables, and risks identified.
Commercialization intent in Canada — a credible path to market with customer validation, IP strategy (as relevant), and scale‑up considerations.
Benefits to Canada, such as job creation, productivity gains, export potential, environmental performance, or strategic capability building.
Typical eligible activity domains include:
Prototype development, testing, and validation.
Algorithm, software, firmware, or hardware development and integration.
Process innovation and advanced manufacturing methods.
Productization steps necessary to reach market readiness (excluding routine business operations).
Activities that are purely market development, routine operations, or unrelated to advancing technology are usually outside scope. However, projects may include limited market or regulatory validation tasks when essential to de‑risk commercialization of the R&D.
Financial & Operational Criteria
IRAP evaluates whether your business is positioned to manage and finance its share of the project:
Cost‑sharing: IRAP is a contribution program with shared costs. Be prepared to fund the non‑covered portion through internal resources or other permitted sources.
Financial health: Up‑to‑date financial statements help demonstrate stability. Startups should highlight capitalization strategy, runway, and investor commitments, if relevant.
Reporting capacity: You must track project activities and costs (e.g., timesheets for eligible labour, subcontractor invoices, materials) and submit reimbursement claims monthly or as agreed.
Governance and controls: Clear roles, decision‑making processes, and IP ownership arrangements with partners/subcontractors reduce risk and support eligibility.
While IRAP is non‑repayable funding, it is performance‑based. Strong operational discipline improves both eligibility and project execution.
Ineligible Applicants
While each case is assessed individually, organizations typically ineligible to lead an IRAP contribution include:
Non‑profit organizations and academic institutions as lead applicants. They may participate as collaborators or subcontractors to an eligible SME, where appropriate.
Unincorporated entities (sole proprietors, general partnerships) unless and until incorporated in Canada.
Businesses without profit orientation or a credible commercialization plan tied to the R&D.
Firms unable to demonstrate sufficient management or technical capacity to deliver the proposed project.
Organizations not in good standing with tax authorities or with significant unresolved compliance issues that jeopardize project success.
If you fall into one of these categories, speak with an ITA to confirm whether partnering models or future eligibility pathways are possible.
Special Cases & Exceptions
Some scenarios require closer review but can still be compatible with IRAP eligibility:
Foreign ownership: Canadian‑incorporated subsidiaries of foreign parents can be eligible if the R&D is carried out in Canada and benefits accrue to Canada (e.g., Canadian jobs, IP development, domestic manufacturing, exports).
Pre‑revenue startups: Eligible if incorporated and able to demonstrate technical feasibility, commercialization intent, and the team’s capacity to execute milestones.
Distributed or remote teams: Permissible if Canadian work is verifiable and core activities occur in Canada; ensure robust time and cost tracking.
Consortium or partner‑heavy projects: SMEs may engage subcontractors, universities, or research institutes for specialized tasks, with the SME retaining project leadership and Canadian value creation.
Youth employment: IRAP also supports youth employment strategy programs that provide wage subsidies when hiring eligible youth for innovation roles. These have specific conditions distinct from project‑based R&D contributions.
For large, transformative projects (occasionally funded up to higher thresholds), NRC IRAP identifies candidates with strong growth trajectories. If you believe your firm fits, prepare objective evidence of scale‑up potential and national benefits.
Self‑Assessment Checklist
Use this quick checklist to gauge fit before contacting NRC IRAP:
Incorporated, for‑profit Canadian company.
500 or fewer FTE employees.
Technology‑driven R&D project with clear technical milestones.
Commercialization plan targeting markets in Canada and beyond.
Canadian value creation: jobs, IP, productivity, exports, or environmental benefits.
Management and technical team capable of delivery.
Ability to cost‑share and maintain records for reimbursement claims.
Up‑to‑date business plan or pitch deck, financial statements, and team résumés.
Willingness to work with an NRC IRAP Industrial Technology Advisor.
If you can confidently check most boxes, you likely meet the core IRAP eligibility profile.
Conclusion
NRC IRAP funding is designed for Canadian SMEs that are incorporated, profit‑oriented, and focused on advancing technology toward commercialization in Canada. Eligibility centres on who you are (SME with ≤500 FTEs), where and how you work (Canadian‑based R&D with verifiable benefits to Canada), and what you plan to do (a structured, milestone‑driven innovation project). Because each proposal is assessed case‑by‑case and budgets vary over the year, confirm current fit and availability directly with NRC IRAP. To discuss your situation or be referred to an Industrial Technology Advisor, contact NRC IRAP at 1‑877‑994‑4727.
As you assess eligibility, consider reading our companion guides on how to apply to IRAP and what IRAP can fund to plan your next steps with confidence.
