The SR&ED Gold Rush: Are You Leaving Money Unclaimed?

Introduction

Every year, Canadian innovators leave value on the table because they under-recognize the breadth of work eligible under SR&ED. What looks like routine debugging, systems integration, or performance tuning might in fact qualify—if framed correctly. The difference between claiming and not claiming can be hundreds of thousands over time.

In this post, we dig deeper into where that “hidden” eligibility lives, how to reliably capture it, and how to defend it if CRA requests proof.

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Where Hidden SR&ED Work Lives

Even mature firms often miss these categories:

• Integration / interface experiments (e.g. combining modules with new constraints)
• Performance tuning / benchmarking under new operating regimes
• Scale-up / reproducibility testing from lab to pilot scale
• Algorithmic or parameter adjustments when existing paths don’t suffice
• Root cause analysis & failure diagnostic work
• Exploring alternative architectures / prototypes

These are often interwoven with your normal workflows—but that’s what makes them easy to overlook.

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Mapping Claims from Artifacts

1. Gather artifacts: Version history (git, firmware), bug / issue tickets, test logs, experiment scripts
2. Engineer interviews: Ask: which tasks required exploration or unknowns? Estimate hours
3. Triangulation: Where logs + interviews overlap, you have more confidence
4. Hypothesis mapping: Attach each block to a hypothesis you tested, failure path, or experiment

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Documentation: Your Defense Build

CRA wants to see that your claim is built on detectable experiments, not retroactive stories. Key elements:

• R&D journal: date, hypothesis, method, results
• Version & change logs
• Test logs, parameter sweeps, benchmark tables
• Meeting notes, emails showing design decisions
• Time attribution linking tasks to experiments
• Cost maps: labour, materials, subcontractor, overhead

If you attempt to reconstruct later, credibility drops significantly.

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Example Case

A mid-size firm with 5,000 engineering hours did a review and found ~6% (~300 h) of work genuinely experimental. At a loaded rate of $80/hr, that’s $24,000 extra in eligible costs. Over 5 years, that compounds—and influences how their R&D plan is structured going forward.

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Risk Mitigation

• Be conservative in estimating hours
• Only include work you can reasonably defend
• Avoid claiming obvious routine work (maintenance, UI polish)
• Maintain separation between experimental vs production code

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Steps to Take Now

1. Conduct a claim opportunity review of past year(s)
2. Institute contemporaneous recording (journals, logs)
3. Train your technical team in identifying experimental work
4. Adjust next year’s planning to include explicit experiment time

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How GovMoney Can Help

GovMoney performs a Claim Opportunity Audit to uncover hidden R&D, supplies templates & training, and helps integrate SR&ED tracking into your development workflows—so you maximize credits while staying audit-ready.