SRED credits are available for Canadian business owners and financial managers to generate working capital and cash flow from their claims. The business owners or managers who file for SRED financing and credits often do not know this. Even more surprised are they discover it is possible to obtain the funding even before financing the claim, under most circumstances.
An immediate cash flow for a government grant that is not repayable would be a better working capital and cash flow strategy. This government program is the best and most risk-free way to bring valuable cash into your business.
Here’s a foundation on which we can build. The federal and provincial governments fund this research and experimental development program called Scientific Research and Experimental Development or SR&ED. As part of your SRED claim, there is an amount from the federal and provincial governments. Together, they gave you a non-repayable tax credit for significant funds you expended on qualifying R&D and business processes.
We work with several clients who have their claims prepared contingently means allowing someone else, such as an SRED consultant, to qualify your claim. At the same time, we absorb all other associated costs SRED consultants can be paid simultaneously while you finance a claim.
It is a fact that SRED claims have been increasing in Canada, and when combined with a somewhat challenging business finance environment, you have the perfect storm, so to speak, for a claim to be considered for financing.
SRED claims are Canada’s ultimate “boutique” financing business. We recommend working with a business financing advisor who can help secure maximum reimbursement and ensure that the claim is financed at market rates, terms, and structures.
SRED financing is considered complex by clients. SRED financing should be approached liklikeany other forms of business funding, except perhaps to understand that the claim cts as the primary collateral. It is called the SRED loan; however, there are no debts on the balance sheet. The SRED financing merely monetizes your current cash flow and working capital.
Following are a few simple steps that sum up the entire process:
- SRED financing application
- due diligence
This is how it works, and most of our clients find that the entire process is completed in only a few weeks, which is valid for most business financings anyways.
If you are not interested in waiting from 1-12 months (sometimes longer), for your government grant check, you should consider SRED financing. As a growing business, you can probably make far better use of those funds now by reducing payables, investing more in research and development, or acquiring business assets.
Considering SRED tax credit financing as an additional toolkit to your overall business strategy is wise. Make the most of your return by working with an expert and maximizing the ash flow and working capital that is essentially free.