Saskatchewan – SR&ED Tax Credits

Just like in most of the other provinces, the SR&ED tax credit program in Saskatchewan is implemented by the Canada Revenue Agency. From April 1st, 2017, the eligible expenditures of Canadian-Controlled Private Corporations (except for tax exempt corporations) qualify for a 10% refundable R&D tax credit that is subject to an annual limit of $1 million in eligible expenditures and a 10% non-refundable R&D tax credit for the portion of eligible expenditures in excess of the $1 million limit. In the case of other corporations, the R&D tax credit in Saskatchewan remains a non-refundable credit at the rate of 10% on eligible expenditures incurred after March 31st, 2015.

On the period before April 1st, 2015 and after March 31st, 2012, the tax credit in this province was refundable for CCPCs subject to a $3 million expenditure limit and non-refundable in all other situations at the rate of 15% on the eligible expenditures. On the period before April 1st, 2012 and after March 31st, 2009, the Saskatchewan tax credit was refundable at the rate of 15% on the eligible expenditures.

The SR&ED tax credit is available to corporations, including corporations that are beneficiaries of a trust and corporations that are members of a partnership with a permanent establishment in the province for the SR&ED carried out there.

The 2017-18 budget announced measures to better target the R&D tax credit to small and medium sized Saskatchewan innovation companies. Still, those that qualify for the federal SR&ED tax credit will also qualify for the province’s share of the same.

Non-refundable tax credits can be carried back three years. They can be carried forward 10 years and applied against Saskatchewan’s income taxes payable. Eligible expenditures are reduced by government and non-government assistance, but not by this province’s R&D tax credit. There is also an option for the corporations to renounce all or part of the tax credit.