Guest blog post by Lauren Valliere, Co-Founder and Managing Partner at GrowWise.
The program gives students a strong foundation in the practical, industry-focused side of computer science and business. Through in-class learning, hands-on projects and real-world internships, they explore emerging tools and methods for software design and development.
Along the way, they gain experience with technologies like artificial intelligence, bio and health informatics, cybersecurity, data mining, and software and web engineering, helping them stay current in a fast-moving field.
Students arrive ready to contribute, with a solid background in areas like software development, web development, and even video game development. Many MAC students enter the program with prior professional experience, yet they remain eager to learn and grow. They bring fresh perspectives, up-to-date technical skills, and a strong desire to apply their knowledge to the workplace.
What SR&ED Actually Is (And What It Is Not)
SR&ED is not a grant. There is no application window, no pitch deck, no competitive intake, and nobody approving your project before you start.
It is a tax incentive claimed after the fact, administered by the CRA and filed alongside your annual T2 corporate tax return. You do the work, you incur the cost, you file, you get reimbursed. For CCPCs (Canadian Controlled Private Corporations), the credit is refundable, which means it arrives as cash in your bank account even if your company has never turned a profit. For a pre-revenue startup in the WEtech ecosystem, that distinction is everything. SR&ED is often the largest cheque a Canadian startup receives that costs it zero equity.
Eligible costs generally include:
- Wages for technical staff doing or directly supporting the experimental work
- Payments to Canadian contractors
- Materials consumed or transformed during experimentation
- Capital equipment used substantially for R&D (newly eligible again in 2026)
The work has to happen in Canada; that includes where your employees and your subcontractors physically sit. Offshore development does not qualify, which is worth knowing before you outsource your next sprint.
If you are unsure if you might be too early for SR&ED, or not yet eligible, GrowWise recently published a complete guide to understanding if you are SR&ED eligible in 2026. Read it here.
The 2026 SR&ED Changes That Matter
Four things moved. Each one is worth real dollars.
- The enhanced expenditure limit doubled — $3M to $6M.The 35% enhanced refundable credit for Canadian-controlled private corporations (CCPCs) used to apply to your first $3million of qualifying R&D spend. It now applies to your first $6 million. In practical terms, the maximum annual cash refund went from about $1.05 million to roughly $2.1 million. These changes apply to tax years beginning on or after December 16, 2024, meaning they likely already apply to the fiscal year you are about to file.
- Capital expenditures are eligible again.This is a big one for the WEtech Alliance network of innovators. Capital equipment was stripped out of SR&ED back in 2014. It is back for property, equipment, or other assets acquired after December 15, 2024. If you bought a test cell, a dedicated prototyping machine, lab instrumentation, or specialized tooling used substantially for experimental work, that spend can now count as an SR&ED eligible expense. For a region built on advanced manufacturing, mobility, and automation, this quietly reopens a large category of eligible costs.
- The phase-out window widened.The taxable capital thresholds that used to squeeze growing companies out of the enhanced rate moved from $10M–$50M up to$15M–$75M. More scale-ups keep access to the enhanced refund rate for longer. CCPCs can also now elect to use a three-year average gross revenue method instead of taxable capital to calculate their limit.
- Eligible Canadian public corporations got access.For the first time, the 35% refundable credit extends beyond CCPCs to eligible Canadian public corporations, with a limit scaled to average gross revenue.
There is also an administrative shift that landed April 1, 2026: the CRA introduced an elective pre-claim approval process that provides upfront technical validation and cuts processing time from roughly 180 days to 90, alongside greater use of AI in claim administration. Faster money, earlier certainty, if your documentation is in shape.
Want to know what the new limits mean for your specific numbers? We’ve built a SR&ED comparison calculator where you can evaluate what these changes mean for your SR&ED refund. Run your numbers through the free SR&ED Refund Calculator. Two minutes, no sales call required.
The Ontario Advantage: Stacking Provincial Credits
These credits are additive to the Federal amounts, totalling an average refund rate of ~64% for salaries and ~40% for contractors, materials and capital costs. This can equate to a significant cash refund for your business every year!
| CREDIT | RATE | REFUNDABLE? | NOTES |
| OTIC – Ontario Innovation Tax Credit | 8.0% | Yes | CCPCs only; $3M annual Ontario expenditure limit. Phases out as prior-year taxable income moves from $500K to $800K, or taxable capital from $25M to $50M. |
| ORDTC – Ontario R&D Tax Credit | 3.5% | No | Available to all corporations with an Ontario permanent establishment. Carries back 3 years, forward 20. |
Federal SR&ED is only part of the picture in Ontario. Provincial credits stack on top of it, and they are calculated first.
Does Your Work Qualify? A WEtech Alliance Reality Check
Eligibility has nothing to do with your size, your sector, your revenue, or how impressive your product sounds. The technical eligibility of SR&ED funding comes down to one question:
Did you encounter a technical problem that existing knowledge could not solve, and did you attack it systematically?
The CRA assesses the day-to-day technical work, not your business goal. “We built a better logistics platform” is a commercial objective. “We could not achieve sub-200ms route recalculation across 40,000 concurrent nodes using any documented approach, so we ran seven architectural experiments and measured the results” is an SR&ED project.
Some examples of what that looks like in this region:
- Mobility and EV supply chain: battery thermal management, powertrain component testing, lightweighting with new composites, validation methods for a high-volume process
- Advanced manufacturing and automation: vision systems that fail on your specific part geometry, tolerances existing tooling cannot hold, robotics integration where documented approaches break down
- Agri-food and agtech: controlled environment optimization, sensing and yield modelling, processing techniques that behave unpredictably at scale
- Software, cybersecurity, and health tech: performance and scalability barriers, novel model architectures, integration problems where no documented solution exists
- Cross-border logistics tech: a real Windsor-Essex specialty, and often full of genuinely unsolved routing, latency, and compliance-automation problems
What does not qualify for SR&ED: routine engineering, configuration, applying known solutions in a known way, UI polish, standard debugging, market research, or work whose only challenge was that your team had not done it before. The uncertainty has to be technological, not business-related.
Not sure which side of the line your project sits on? Work through GrowWise’s SR&ED eligibility checklist before you go any further.
What a Claim Is Actually Worth
For Ontario CCPCs, combined federal and provincial recovery on the SR&ED portion of your spend generally lands in these ranges:
- Employee salaries: roughly 60–65%
- Contractor costs: roughly 33%
- Materials: roughly 40%
- Capital equipment (used 90%+ for SR&ED): roughly 40%
The critical word is portion. Consider a developer on a $100,000 salary. They spend half their time on tickets, maintenance, and small bug fixes, none of which is SR&ED eligible. The other half of the time goes to solving a genuinely unsolved authentication and data-isolation problem that required designing, testing, and discarding multiple approaches. Only that half counts as SR&ED eligible time. This means 50% of the salary is SR&ED eligible, so $50,000, which is then eligible for the SR&ED refund rate of 64%, equating to a SR&ED refund of an estimated $32,000.
Scale that across a five-person technical team, and SR&ED stops being an accounting footnote and starts being a hiring decision and significant cash flow increase to the business.
Documentation: The Part That Decides Everything
Per the CRA’s own program statistics, about 90% of SR&ED claims are accepted as filed, and roughly 10% get reviewed each year. When you are in that 10%, you have to prove both technical eligibility and accurate expense allocation, and you have to prove it with evidence, not memory or estimates.
The CRA is looking for four things:
- The technical uncertainty. A specific, documented obstacle that available knowledge, tools, or off-the-shelf solutions could not resolve.
- What you did about it. The systematic investigation itself, the variables you changed, the tests you ran, the iterations, the hypotheses you killed. This is where eligibility actually lives.
- What you learned. Success is not required. Advancement of knowledge is. If the work produced no new understanding, it likely was not SR&ED.
- Who did the work, and when. Time per person, per project, per month, across the year. This is the single most common failure point in reviewed claims.
Usable evidence includes time-tracking and payroll data, technical designs and test results, meeting notes and email threads, commit history and issue trackers with time allocated per task, prototypes, invoices, material records, and photos.
The best audit is no audit, so keeping strong records and avoiding these 10 common SR&ED audit triggers is your best bet.
GrowWsie has built an AI-driven technology to support teams in year-round SR&ED tracking to ensure the claims are maximized and strong to ensure CRA compliance. If you’re curious, reach out to [email protected] to learn more.
Deadlines and Process
You file your SR&ED claim with your T2 corporate return after your fiscal year closes. If you have already filed and did not include SR&ED, you can amend your tax return, but only within 18 months of your fiscal year end. That deadline is hard. There are no extensions, and missing it forfeits the credit permanently.
Processing typically runs two to five months, depending on complexity and whether a review is triggered.
Roughly 80% of claimants work with SR&ED consultants to prepare the technical and financial components. The reason is straightforward: the technical narrative is a specific genre of writing with a specific audience, and the cost allocation methodology has to survive scrutiny. GrowWise takes an AI-driven approach to the information-gathering side of this, which means far fewer hours pulled out of your engineering team and a claim built on structured data rather than end-of-year archaeology.
Frequently Asked Questions
Do I need to be profitable to claim SR&ED? No. For CCPCs the enhanced credit is mostly refundable, so pre-revenue and unprofitable companies receive cash. This is why SR&ED is the backbone of non-dilutive funding for early-stage Canadian startups.
Does the project have to succeed? No. SR&ED rewards the systematic investigation and the knowledge gained. A failed experiment that advanced your technical understanding is a perfectly valid claim. A successful project with no technical uncertainty is not.
Can I claim SR&ED for work done by offshore contractors? No. The qualifying work must be performed in Canada, including the physical location of employees and subcontractors.
What if my R&D spend is small? It depends on how small; use the SR&ED calculator now to estimate your SR&ED refund. We typically say that if the claim is less than $15,000-$20,000, it might not be worth the trouble, but it is always up to the claimant.
When should documentation start? The day the project starts. Contemporaneous records are worth exponentially more than reconstructed ones, and they cost far less effort to produce.
Does SR&ED affect my ability to access other funding? Other government assistance generally reduces your SR&ED expenditure base, so stacking has to be planned. It rarely eliminates the claim, but it changes the math, and it is worth modelling before you accept a grant.
Next Steps for the WEtech Alliance Community
The 2026 expansion means a lot of companies in Windsor-Essex and Chatham-Kent are now sitting on a materially larger claim than they were two years ago, particularly manufacturers and hardware companies who wrote SR&ED off when capital costs were excluded.
If you are not sure whether you qualify, or you are claiming already and suspect you are leaving money behind, here is where to start:
- Check your eligibility with the SR&ED checklist — five minutes, no commitment.
- Estimate your refund with the SR&ED calculator — see what the new limits do to your numbers.
- Book a call with the GrowWise team — a short conversation is usually enough to tell whether there is a claim worth building, or if you’re already filing, let’s see if we can help simplify the process.
Questions about SR&ED, eligibility, or how to get started? Reach out directly to Lauren, Co-founder and Managing Partner at GrowWise, at [email protected], or the team at [email protected].
GrowWise is an SR&ED partner, working with startups and scaleups around Canada to simplify the SR&ED claim process. They’ve built an AI-forward approach to reduce the time and cost for the businesses they work with. Learn more at https://growwise.ai
Lauren Valliere is the Co-Founder and Managing Partner at GrowWise, where she supports innovative companies through a smarter, easier SR&ED process. With a background in engineering and experience in operations and technical project leadership, she focuses on making SR&ED stress-free and accessible for teams of all sizes.
