Ontario Business Research Institute Tax Credit
ON, Canada
Business tax credit for scientific research in Ontario
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|noCondition
grant_single|deadlines
- grant_single|openingDateNovember 14, 2019
grant_single|financingType
Tax Credits
grant_single|eligibleIndustries
- Professional, scientific and technical services
- Educational services
- Health care and social assistance
grant_single|grantors
- Ontario Ministry of Finance
- Government of Ontario
grant_single|status
grant_card_status|open
grant_single_labels|preview
Claim a 20% refundable tax credit for qualified expenditures on scientific research and experimental development work performed in Ontario under contract with eligible research institutes. Qualified expenditures are capped at $20 million annually. The max
grant_single_labels|projects
Eligible corporations must carry on business through a permanent establishment in Ontario. This restriction aligns with the regional focus on boosting research and innovation within the province.
- Ontario, Canada
grant_single|admissibleProjectsExample
$500,000
Edmonton
Creating a clean energy solution for residential buildings with University of Alberta
$400,000
Ottawa
Developing a new remote healthcare monitoring system with Ottawa Hospital Research Institute
$300,000
Toronto
Developing an AI-driven financial analysis system for cooperative use
$200,000
Hamilton
Researching sustainable packaging solutions with McMaster University
$360,000
Toronto
Creating a smart urban farming system in partnership with Ryerson University
$240,000
Kitchener
Developing a biodegradable textile with University of Waterloo for fashion industry
grant_single_labels|admissibility
Eligibility for corporations to claim this tax credit is based on specific business criteria and contractual relationships.
- The corporation must carry on business in the tax year through a permanent establishment in Ontario.
- The corporation must not be exempt from corporation income tax.
- The corporation must have entered into an eligible contract with an eligible research institute.
- The corporation must not be connected to the eligible research institute as defined by the criteria of share ownership, partnership, or related rules.
grant_eligibility_criteria|who_can_apply
Eligible corporations for the Ontario business research institute tax credit include those that carry on business in Ontario through a permanent establishment, are subject to corporation income tax, have eligible contracts with approved research institutes, and are not connected to these institutes as per specific criteria.
grant_eligibility_criteria|eligible_expenses
This tax credit is available for scientific research and experimental development projects performed under contract by eligible research institutes in Ontario. The activities supported are aimed at stimulating innovation and research within corporations operating in the region.
- Scientific research conducted by eligible Ontario universities or community colleges on behalf of a corporation.
- Experimental development projects carried out by Ontario hospital research institutes.
- Collaborative research facilitated by the Ontario Centres of Excellence or federal Network of Centres of Excellence operating in Ontario.
- Scientific exploration and studies by designated non-profit research organizations in Ontario.
grant_eligibility_criteria|zone
The grant covers qualified expenditures on scientific research and experimental development performed by eligible research institutes in Ontario.
- Payments of money (not payments-in-kind) to eligible research institutes.
- Current expenditures that qualify for the federal investment tax credit.
- Expenditures for scientific research and experimental development performed by eligible research institutes in Ontario.
grant_single_labels|criteria
There are evaluation and selection criteria for this grant.
- The corporation must carry on business in Ontario through a permanent establishment
- The corporation must not be exempt from corporation income tax
- The corporation must enter into an eligible contract with an eligible research institute
- The corporation must not be connected to the eligible research institute
- The eligible research institute must meet the criteria specified
- The contract must meet certain requirements and be entered into after a specified date
- The expenditure must qualify as a qualified expenditure with an eligible research institute
grant_single_labels|register
Here are the steps to submit an application for the Ontario Business-Research Institute Tax Credit:
- Step 1: Review Eligibility Criteria
- Ensure your corporation meets the eligibility requirements, including having a permanent establishment in Ontario and not being connected to the eligible research institute.
- Confirm the scientific research and experimental development is performed in Ontario under a contract with an eligible research institute.
- Step 2: Enter into an Eligible Contract
- Negotiate and finalize an eligible contract with an eligible research institute for scientific research and experimental development services.
- Ensure the contract complies with all stipulated conditions such as being entitled to exploit the research results.
- Step 3: Prepare Documentation
- Collect all relevant financial documentation related to the qualified expenditures.
- Ensure expenses are only payments in money, not in kind, and also qualify for the federal investment tax credit.
- Step 4: Complete Schedules
- Download and complete Schedule 568, Ontario Business-Research Institute Tax Credit.
- For each eligible contract, complete Schedule 569, Ontario Business-Research Institute Tax Credit Contract Information.
- Step 5: File T2 Corporation Income Tax Return
- Submit the completed Schedules 568 and 569 along with your T2 Corporation Income Tax Return to the Canada Revenue Agency.
- Ensure timely submission before the tax filing deadline.
- Step 6: Confirmation of Claim
- Retain copies of all submitted documents for your records.
- Await confirmation from the Canada Revenue Agency regarding the processing of your tax credit claim.
grant_single_labels|otherInfo
Here are additional relevant details for this tax credit:
- There is a cap on the annual qualified expenditures eligible for the credit, which is set at $20 million, meaning no more than this amount can be claimed in a year.
- The maximum annual refundable tax credit that can be claimed is $4 million.
- While the tax credit is refundable, it applies only to corporations that are not exempt from corporate income tax.
- Eligible contracts for this tax credit must have been entered into after May 6, 1997.
Apply to this program
Ontario Business Research Institute Tax Credit
The Ontario Business Research Institute Tax Credit offers a 20% refundable tax credit for corporations engaging in scientific research and experimental development through contracts with eligible Ontario research institutes. This initiative facilitates innovation and supports scientific advancements for businesses operating within the province.
Understanding the Ontario Business Research Institute Tax Credit
This tax credit is part of Ontario's efforts to bolster economic growth and innovation by encouraging corporate investment in scientific research and experimental development (SR&ED). The program allows eligible corporations to claim a portion of their expenditures on SR&ED projects conducted in partnership with research institutions across Ontario, providing a financial incentive to foster collaboration between private sector businesses and research bodies. Corporations can access up to $4 million annually through this credit, up to 20% of their qualified expenditures, incentivizing substantial investments in research and innovation. This refund opportunity is particularly beneficial for businesses that might lack the initial capital to fund extensive research projects, thereby reducing the financial risk associated with pioneering research endeavors.
The program targets expenditures capped at $20 million which ensures a significant reach across various business sizes and allows multiple corporations to benefit from the initiative. By teaming up with accredited research institutions such as Ontario universities, community colleges, and notable research organizations like Ontario Centres of Excellence, corporations gain valuable insights and expertise that enhance the development and commercialization of new technologies or methodologies.
Corporations engaging in this program must ensure their work is performed within Ontario and is connected to their business operations, making the geographical scope and business relevance critical to eligibility. This stipulation ensures the economic benefits of such research activities remain within Ontario, contributing to local job creation and economic activity.
Special mention is made for the eligibility of small businesses, which can leverage this credit alongside the Ontario Innovation Tax Credit, amplifying the support for small enterprises aiming to scale their operations through enhanced research capabilities. These businesses often serve as a crucial engine for economic growth, and their participation in SR&ED projects is vital for the province's innovation ecosystem.
Documentation for claiming this tax credit is mandatory through specific forms (Schedule 568 and Schedule 569), and its administration is conducted by the Canada Revenue Agency on behalf of Ontario. This integration within the federal tax system streamlines the process of application, ensuring corporations can efficiently access and file for their potential refunds alongside their regular tax returns.
Throughout its operation, this tax credit has played a pivotal role in not only advancing research and development within the province but also in establishing Ontario as a competitive and attractive location for business innovation. It stands as a testament to the province's commitment to fostering a scientific community that supports economic diversification and resilience.
Overall, the Ontario Business Research Institute Tax Credit is an effective instrument that aligns corporate financial capability with academic and research excellence, ensuring that innovation is woven into the fabric of Ontario's economic development. Businesses looking to minimize expenses on crucial R&D while maximizing potential returns find in this program a persuasive opportunity to engage in cutting-edge research that pushes the boundaries of what is considered possible.
