Report expenditures with form T661

Requirements for partners in a partnership

When SR&ED work is carried out by a partnership, some special requirements apply:

• The entire amount in the partnership's pool of deductible SR&ED expenditures must be deducted in calculating the net income of the partnership in the year the expenditures are incurred
• A partnership will not have a pool of SR&ED expenditures to carry forward to future tax years
• Partners in a partnership cannot include the partnership’s SR&ED expenditures in their own pool of deductible SR&ED expenditures

Since SR&ED expenditures are deducted at the partnership level, the partnership should submit a Form T661.

A partner in the partnership may do this on the partnership’s behalf. However, the total SR&ED expenditures they report must be those of the partnership, and not just a particular partner’s share of those expenditures.

If a partner in a partnership conducted SR&ED work independent of the partnership, they must submit their own Form T661, and they must not include any of the partnership’s SR&ED expenditures.

To learn more about how partnerships must fill out Form T661, review Partnerships, T4088 guide to SR&ED Expenditures Claim.