# SR&ED for Software Companies | GrantOps

Software development is one of the most common — and most frequently underclaimed — categories of SR&ED-eligible work in Canada. If your team is building technology that involves overcoming technological uncertainty, your development work likely qualifies for SR&ED tax credits worth 15-35% of eligible expenditures.

## What Software R&D Qualifies for SR&ED?

CRA applies a three-part test: (1) Was there technological uncertainty? (2) Was there systematic investigation? (3) Was there a technological advancement? Software projects that qualify typically involve:

- Developing new algorithms, data structures, or architectures where no known solution exists
- Building novel AI/ML models, NLP pipelines, or computer vision systems with uncertain performance outcomes
- Creating distributed systems, real-time processing engines, or database architectures that push beyond established methods
- Overcoming integration challenges between complex systems with no documented approach
- Developing security frameworks, encryption methods, or authentication protocols with novel requirements
- Building compilers, interpreters, or developer tools requiring fundamental CS research

## SR&ED Rates for Software Companies

- **CCPCs (most startups)**: 35% refundable federal credit on first $3M of qualifying expenditures
- **Other corporations**: 15% non-refundable federal credit
- **Provincial top-ups**: Ontario (10%), Quebec (up to 30%), BC (10%), Alberta (8%) stack on top

Eligible expenses include developer salaries (time spent on SR&ED), contractor costs (80%), cloud infrastructure consumed during experimentation, and overhead via the proxy method (55% of SR&ED labour).

- Automate your SR&ED claim: https://grantops.ai/en/automate-sred/
- Full SR&ED guide: https://grantops.ai/en/sred/
- Get started: https://app.grantops.ai