Innovative companies in Toronto build, test and fix technology every day, and some of that work qualifies for SR&ED tax credits. The problem is rarely eligibility.
It is documentation: development that was never tracked as R&D, claims that leave Ontario’s provincial credits on the table, and technical narratives that do not hold up when the CRA asks questions.
Emergex has prepared SRED claims for over 25 years. From our office at 176 Yonge Street, our SR&ED consultants in Toronto help startups and established companies across the GTA turn real technical work into complete, CRA-compliant claims, federal and provincial.
A Canadian-controlled private corporation (CCPC) doing R&D in Ontario can combine federal and provincial credits. Most of the value is paid as a cash refund, even if the company is not yet profitable.
| Credit | Rate | Refundable? | Key limit |
| Federal SRED ITC, enhanced (CCPCs) | 35% | Yes | First $6M of qualifying expenditures per year |
| Federal SR&ED ITC, general | 15% | No (partly for some CCPCs) | Expenditures above $6M, and non-CCPCs |
| Ontario Innovation Tax Credit (OITC) | 8% | Yes | First $3M; phased out between $500K and $800K of prior-year taxable income, and between $25M and $50M of taxable capital |
| Ontario R&D Tax Credit (ORDTC) | 3.5% | No | Reduces Ontario corporate tax payable |
| Ontario Business-Research Institute Tax Credit (OBRITC) | 20% | Yes | Payments to eligible Ontario research institutes |
Recent federal changes now in force (Bill C-15, Royal Assent March 26, 2026) apply to taxation years beginning after December 15, 2024. The enhanced 35% limit doubled from $3M to $6M. Eligible Canadian public corporations can now access it. Capital expenditures on SRED are eligible again.
A Toronto software CCPC spends $500,000 on qualifying SR&ED salaries in one year.
It assumes every expenditure qualifies, prior-year taxable income under $500,000 and no other government assistance. Your claim will differ; our assessment gives you a real estimate.
Most Toronto companies we review are already doing eligible work. Value is lost in the claim, not in the lab:
Toronto has one of Canada’s largest software ecosystems, from downtown scale-ups to enterprise teams in North York. Eligible work often includes architecture redesigns under scaling constraints, performance problems that standard solutions could not solve, real-time data processing and security challenges in financial platforms.
Toronto’s AI ecosystem, anchored by research institutes such as the Vector Institute, produces a steady flow of SRED. Claims are strongest when a team had to develop new model architectures, training methods or data approaches because known techniques did not reach the required performance. Routine model training and tuning with established methods usually does not qualify, and we will tell you so.
Manufacturers in Mississauga, Brampton, Vaughan and Markham generate SR&ED through automation and robotics integration, new materials, tooling development and process changes that had to be tested on the production line.
Device developers, diagnostics companies and health software firms qualify through prototyping, validation testing and algorithm development. When R&D is contracted to an eligible Ontario research institute, the 20% OBRITC can add to the claim.
Engineering firms across the GTA qualify through design optimization, simulation, new building systems and the problem-solving that happens when a prototype fails testing.
If your team is building, testing or improving technology in Toronto or the GTA, you may already be eligible for significant SRED and Ontario tax credits. We will review your projects and estimate your potential refund at no cost.
We serve companies in downtown Toronto, North York, Scarborough, Etobicoke, Mississauga, Brampton, Vaughan, Markham, Oakville, across the GTA and as far as Waterloo.
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Yes. Our Toronto office is at 176 Yonge Street, 6th Floor. We work with companies across the GTA.
Ontario adds the Ontario Innovation Tax Credit (8%, refundable, on up to $3 million of expenditures for qualifying corporations), the Ontario R&D Tax Credit (3.5%, non-refundable) and, for payments to eligible research institutes, the 20% OBRITC. Provincial credits reduce the expenditure base for the federal credit, so they must be calculated together.
Any company that carries out systematic work to overcome a technological uncertainty can qualify. In Toronto, this is most common in software, AI, fintech, manufacturing, medical technology and engineering. You do not need a dedicated R&D department or staff with PhDs.
Keep project plans, technical notes, tickets, code commits, test results, prototypes and timesheets that link people and costs to specific projects. Records created during the work carry the most weight with the CRA.
You must file within 18 months of the end of the tax year in which the expenditures were incurred. Late claims are not accepted.
The CRA’s service standard is 60 days for claims accepted as filed and 180 days for refundable claims selected for review, counted from receipt of a complete claim.
No. We work with companies across the GTA, including Mississauga, Brampton, Vaughan, Markham, North York, Scarborough, Oakville and as far as Waterloo.
We prepare technical and financial responses, perform dry runs with your technical representative, attend the meetings with you and support your team until the review is closed.
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We are proud to be a trusted partner for companies across Canada looking to leverage SR&ED, other tax credits and grants. Benefit from our quarter of a century of experience by asking our opinion about your past, present and future claims!