Claim SR&ED tax incentives - What documents are required
What documents are required
Keep supporting information and records to prove that the SR&ED work was performed and allowable expenditures were made in the year. The business environment in which SR&ED is carried out influences the type and sources of evidence that are available to support the SR&ED claim. If your SR&ED claim is selected for review, we will ask you to provide supporting documentation that was generated as the SR&ED was being carried out.
The following sections outline the type of documents and other items that CRA reviewers generally consider as supporting evidence. If you are a first-time claimant, you might not have enough documentary information to support your claim. Don’t let this discourage you from making a claim; it’s not an indication that SR&ED did not take place. Instead, ask the CRA to help you identify the evidence you can use to support your SR&ED work and related expenditures:
Support for SR&ED work conducted
Most often, supporting evidence is in the form of documents that were generated while the SR&ED was being carried out. In fact, documentation that is dated, signed and specific to the work performed is the best supporting evidence that you can provide. If you choose to use evidence that was produced after the SR&ED work was carried out, you must make sure that the evidence clearly addresses the project information in Part 2 of Form T661.
Supporting for SR&ED expenditures claimed
You also must keep complete and organized records that support the expenditures you claimed. See keeping records to find out what you need to keep to support financial transactions. Records and documents that the CRA might ask for during the review include financial statements, records, ledgers, journals and vouchers, including electronic records. We may also ask for source documents such as receipts, contracts and general correspondence. In addition to these general financial records, keep any related documents and information to support the specific expenditures you claimed on Form T661.
As described in Appendix 2 of Guide T4088, Guide to Form T661, supporting evidence for SR&ED work can take a number of different forms:
- project planning documents
- documents on design of experiments
- experimentation plan
- design documents and technical drawings
- project records, laboratory notebooks
- design, system architecture and source code (software development)
- records of trial runs
- project progress reports
- minutes of project meetings
- test protocols, data, results, analysis and conclusions
- final project report or professional publication
- photographs, videos
- prototypes, samples
- scrap, scrap records
- contracts, lease agreements
- records of resources allocated to the project, time sheets, activity records, payroll records
- purchase invoices and proof of payment
- accounting records
This is not a complete list. Keep any documentation and evidence that you feel will support your claim.
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