I’ve come across several instances during my period in the SR&ED program where an SR&ED claimant assumed that they were doing eligible work because their claim was accepted as filed by the CRA. I’ve heard this comment even more lately from SR&ED claimants as I’ve attended more CRA reviews. It seems that many claimants in CRA’s SR&ED program may be confused by what the term accepted as filed actually means.
What does accepted as filed mean?
In the SR&ED program if your claim is accepted as filed you will receive a letter stating so. In that letter you’ll also see a statement similar to, “While your claim has been accepted as filed your project has NOT been reviewed from a technical perspective”. What does this mean? It means the CRA’s risk policy allowed your claim to not be judged on technical merit and has instead been passed through the system based on financial merit only.
Why does the CRA accept SR&ED claims as filed?
There are a variety of reasons, but the usual reasons are related to both the size of your claim and your claim history. For instance, if the size of your claim is within a certain percentage of your previous claims and one of your previous claims was accepted with a technical review there is most likely a low amount of risk to CRA to accept your claim as filed.
Another reason for your claim being accepted as filed could be sheerly because the number of claims were too high to administer for CRA staff. Well, the CRA has recently done something about this and doubled its technical staff across the nation.
Understanding these points should beg you to ask if the work you’ve been claiming is actually eligible work or if it’s just gone under the radar at CRA.
So is my work eligible?
If you’ve NEVER been reviewed and thus NEVER received a letter stating that your work is eligible then the simple answer is we don’t know. This doesn’t mean stop claiming, but it does mean that you should continue to be diligent with your documentation process and ensuring your following the guidelines laid out by CRA in order to be eligible for the SR&ED program just in case they come knocking.
For more information, a free consultation, or just to ask some questions, be sure to contact us and we’ll get back to you shortly.