How to Calculate Your SR&ED Tax Credit in Canada
Federal and provincial SR&ED rates, required inputs, and free calculators to estimate your Canadian R&D tax credit.
An SR&ED calculator estimates your refund before you file — useful for cash-flow planning, board updates, and evaluating whether professional filing support is worth the cost. Here is what goes into the calculation.
Inputs You Need
- Eligible salaries and wages — staff time directly engaged in SR&ED
- Materials consumed — transformed or consumed in R&D (not sold as product)
- Contract payments — Canadian third-party R&D (subject to 80% rule)
- Overhead — proxy method (55% of eligible salaries) or traditional allocation
- Company type — CCPC vs other (affects refundable rate)
- Province — provincial credits vary (ON, QC, BC, AB, etc.)
Federal Rates
CCPCs generally receive 35% refundable on the first $3M in qualifying expenditures, and 15% non-refundable above that threshold. The expenditure limit phases down for companies with taxable capital between $10M and $50M.
Provincial Stacking
Ontario adds 8%, Quebec up to 14% on top of federal, BC offers 10%, Alberta 10% — rates change, so always verify current provincial schedules. Our R&D Investment Calculator includes federal and provincial estimates in one view.
Next Steps
A calculator gives you a range — not a filed claim. Confirm eligibility with the SR&ED Eligibility Quiz, then prep documentation using the T661 Checklist before engaging a filer or filing yourself.