Raymond Chabot Grant Thornton shared its observations regarding the federal consultation process on the impact fees have on the efficiency of the Scientific Research and Experimental Development (SR&ED) Tax Incentive Program. As this is the most important industrial research and development program in Canada, our team of SR&ED experts made it a prerogative to get involved and inform the Canadian government of the realities of our practice and the steps that could improve the program’s efficiency.
Our team of experts includes experienced engineers, technical staff (all sectors and industries), tax specialists, lawyers and accountants. We have been helping our clients prepare their SR&ED claims for more than 20 years.
“We believe that contingent fees encourage the introduction of new SR&ED claimants. For current claimants, this type of fee promotes risk-sharing with consultants and a better alignment of the timing of fees and obtaining of credits,” stated Michel Lefebvre, Tax Partner and member of the firm’s SR&ED team.
This type of fee, which is a financial arrangement like any other, is popular in the field of SR&ED credit claims because results are unpredictable. “This lack of predictability is due to the great complexity involved in preparing a claim file and the inconsistency of decisions, which are based on professional judgment and as a result, are highly arbitrary,” added Michel Rheault, Tax Partner and also a member of the firm’s SR&ED team.
Raymond Chabot Grant Thornton believes that the best way to eliminate contingent fee billing is to increase the predictability of decisions. In this regard, the response submitted to the Government of Canada presents five measures:
- Simplify the SR&ED program by making criteria easier to measure objectively;
- Pre-approve SR&ED programs;
- Create an innovation support program;
- Have the CRA certify external SR&ED consultants;
- Drive out “professional exaggerators”.
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