Canada: Claim integrity measures | Research Credit Integrity Alliance

Canada does not require advance notice of an SR&ED claim. Instead, the Income Tax Act and the CRA build integrity measures into the claim itself: a prescribed form with a strict deadline, project descriptions with word limits, a record of who wrote them, a list of supporting evidence, details of every paid claim preparer and how they are paid, and signed certifications. This page sets out each measure and the consequence the official sources attach to it.

Summary

Measure	What the official sources say
Prescribed form	Form T661, filed with Schedule T2SCH31 (corporations) or Form T2038(IND) (individuals) to claim the investment tax credit.12
Deadline	12 months after the filing due date of the income tax return for the year.12
Missing prescribed information	No deduction for the expenditure concerned.1
Late form	The expenditure is deemed not to be an SR&ED expenditure.1
Project descriptions	Part 2 for each project, with word limits of 350, 700 and 350 on lines 242, 244 and 246.23
Who wrote the descriptions	Lines 253 to 259 of Part 2 name the employee or external consultant who prepared them.23
Supporting evidence	Lines 270 to 282 list the evidence held; documents are retained, not filed.23
Claim preparer details	Part 9 names each paid preparer, the billing arrangement and the total fee, with a $1,000 penalty for missing, incomplete or inaccurate information.24
Certification	Part 9 and Part 10 are signed by the individual, authorized signing officer or authorized partner.23

The prescribed form and the deadline

Subsection 37(11) of the Income Tax Act requires a taxpayer that claims an SR&ED deduction to file a prescribed form with the Minister on or before the day that is 12 months after the taxpayer's filing due date for the year. The form must contain prescribed information in respect of the expenditure and claim preparer information as defined in subsection 162(5.3).1

The Act attaches two consequences to these requirements. If the prescribed information about an expenditure is not contained in the form, no amount in respect of that expenditure may be deducted under subsection 37(1).1 If the form is not filed in accordance with subsection 37(11), the expenditure is deemed not to be an expenditure on or in respect of SR&ED.1

The CRA's guide explains that the deadline gives corporations 18 months and individuals 17.5 months from the end of the tax year, and that a claimant who misses it will not be entitled to the SR&ED incentives for that expenditure.3 Form T661 itself states that the information requested in the form, and the documents supporting the expenditures and project information in Part 2, are prescribed information.2 The guide notes that using a previous version of Form T661 for a current year claim may delay processing, and that it is mandatory for most corporations to file electronically.3

Project descriptions

Part 2 of Form T661 is completed separately for each project. It asks three questions: what scientific or technological uncertainty the claimant attempted to overcome (line 242, maximum 350 words), what work was performed in the tax year to overcome it (line 244, maximum 700 words), and what scientific or technological advancement was achieved or attempted (line 246, maximum 350 words).2 The guide states that a claimant may submit Part 2 for only the 20 largest projects by dollar value at the time of filing, and that failure to provide the information will result in the disallowance of the expenditures.3

Part 2 also asks whether the project continues a previously claimed project, whether it is a first claim, and whether the project was pre-approved, with a pre-approval case number on line 214.2 See pre-claim approval.

Who prepared the descriptions

Section C of Part 2 asks who prepared the responses to the project description questions. The form offers three choices, each with a name: an employee directly involved in the project (lines 253 and 254), another employee of the company (lines 255 and 256), or an external consultant (lines 257 and 258), in which case the consultant's firm is given on line 259.2 The guide states that an external consultant is not an employee of the company.3

This question is separate from Part 9. Part 2 records who wrote the technical narrative for each project; Part 9 records every paid claim preparer and how they are paid.2

Supporting evidence

Lines 270 to 282 ask the claimant to tick the kinds of evidence it holds for each project, such as project planning documents, time sheets, design of experiments, laboratory notebooks, source code, test data, progress reports, photographs, prototypes and contracts.2 The form states that these items do not need to be submitted with the claim, but must be retained in the event of a review.2 The guide adds that evidence not listed can still be provided to the CRA reviewer during a review.3

The Income Tax Act requires every person carrying on business to keep records and books of account that enable the taxes payable to be determined, and generally to retain them for six years from the end of the last taxation year to which they relate.5 The CRA's review guide states that a lack of supporting information could result in the partial or full disallowance of a claim.6

Claim preparer details

Part 9 of Form T661 must be completed for each claim preparer that has accepted consideration to prepare or assist in preparing the claim.2 Line 935 asks whether a claim preparer was engaged in any aspect of the claim. If one was, the claimant gives the preparer's name, business number, billing arrangement code, billing rate, any other billing arrangement and the total fee paid, payable or expected to be paid (lines 940 to 965).2 The first billing arrangement code is a contingency fee arrangement, where the fee is based on a percentage of the investment tax credit earned.2

The form states that a $1,000 penalty may be assessed if this information is missing, incomplete or inaccurate, and that the claimant and the claim preparer will be jointly and severally, or solidarily, liable.2 The penalty is in subsection 162(5.1) of the Income Tax Act.4 In 2023 the CRA advised claimants to provide this information for each preparer and to be wary of any preparer who asks them to omit it.7 See Form T661 claim preparer details and claim preparer information penalty.

Certification

Lines 970 and 975 of Part 9 are completed whether or not a preparer was engaged.2 Part 10 contains a certification that the signer has examined the information on the form and attachments and that it is true, correct and complete, signed by the authorized signing officer of the corporation or the individual (lines 165 and 170).2 Line 175 asks for the name of the person or firm who completed the form; the guide describes it as the person, firm or representative that helped complete it.23

The CRA's review guide states that once a claim has been selected for review it cannot be withdrawn, and that the Part 10 certification cannot be revoked.6 The CRA has also told claimants that they are legally responsible for the accuracy of their claims, including information a third party submits on their behalf, and has advised them never to sign a blank form and always to ask for a copy of the application.8

Use of the information

The privacy notice on Form T661 states that personal information is collected under subsections 37(1), 37(11) and 162(5.1) of the Income Tax Act and is used for verification of compliance, administration and enforcement of the SR&ED program requirements, and that incomplete or inaccurate information may result in monetary penalties and delays in processing.2 Every claim then undergoes a risk assessment; see reviews and audits.6

Recent changes

Budget 2025 stated that the CRA would increase the use of artificial intelligence in administering the program, eliminate unnecessary steps and reduce burdensome information requirements, with the administrative changes implemented as of April 1, 2026.9 It also said the CRA would hold targeted consultations that include reviewing Form T661.9 The version of Form T661 used for this page is T661 E (26).2

Sources

Government of Canada, Income Tax Act, RSC 1985, c 1 (5th Supp), subsections 37(11), (11.1) and (12). https://laws-lois.justice.gc.ca/eng/acts/I-3.3/section-37.html (accessed 11 October 2026). Back
Canada Revenue Agency, Form T661, Scientific Research and Experimental Development (SR&ED) Expenditures Claim, T661 E (26), page 1, Part 2 (lines 200 to 282), Part 9 (lines 935 to 975 and billing arrangement codes), Part 10 (lines 165 to 175) and privacy notice. https://www.canada.ca/content/dam/cra-arc/formspubs/pbg/t661/t661-26e.pdf (accessed 11 October 2026). Back
Canada Revenue Agency, T4088, Guide to Form T661 (T4088(E) Rev. 20), sections on the SR&ED reporting deadline, filing requirements, Part 2 (lines 242 to 282), Part 9 and Part 10. https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4088/guide-form-t661-scientific-research-experimental-development-expenditures-claim-guide-form-t661.html (accessed 11 October 2026). Back
Government of Canada, Income Tax Act, RSC 1985, c 1 (5th Supp), subsections 162(5.1), (5.2) and (5.3). https://laws-lois.justice.gc.ca/eng/acts/I-3.3/section-162.html (accessed 11 October 2026). Back
Government of Canada, Income Tax Act, RSC 1985, c 1 (5th Supp), subsections 230(1) and (4). https://laws-lois.justice.gc.ca/eng/acts/I-3.3/section-230.html (accessed 11 October 2026). Back
Canada Revenue Agency, The SR&ED Review Process: A Guide for Claimants (April 20, 2026), sections "Why has your claim been selected for review", "Can you withdraw your claim after it has been selected for review" and Appendix A. https://www.canada.ca/en/revenue-agency/services/scientific-research-experimental-development-tax-incentive-program/technical-review-a-guide-claimants.html (accessed 11 October 2026). Back
Canada Revenue Agency, Are you preparing to claim SR&ED tax incentives? Here's what you need to know (tax tip, May 30, 2023). https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2023/preparing-to-claim-sred-tax-incentives-what-you-need-to-know.html (accessed 11 October 2026). Back
Canada Revenue Agency, Advisory for businesses claiming SR&ED investment tax credits (tax tip, October 12, 2022). https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2022/advisory-businesses-claiming-sred-investment-tax-credits.html (accessed 11 October 2026). Back
Department of Finance Canada, Budget 2025, Chapter 1, section "Enhancing the Scientific Research and Experimental Development Tax Incentives". https://budget.canada.ca/2025/report-rapport/chap1-en.html (accessed 11 October 2026). Back