Client Overview
Our client is a large-scale manufacturer of reusable injection-moulding plastic solutions across North America. They have been in operations since 1976 and are committed to manufacturing 100% recyclable premium plastic products through scientific injection moulding technology. The company provides full engineering and design-innovation services to help its clients develop professional drawings and 3D models whilst improving the early design phase with the use of rapid prototyping by 3D printing additive manufacturing.
Problem Statement
Our client was filing their Scientific Research and Experimental Development (SR&ED) tax incentives claim to the Canada Revenue Agency (CRA) and was facing the technicalities of the submissions for the first time. Although they had been into innovative plastic manufacturing since a long time ago but were not sure about the SR&ED eligibilities. Additionally, they were unsure of how the eligibility rules extended to manufacturing, where they were attempting to find solutions to a variety of plastic moulding-related challenges, including material development, structural design, and manufacturing optimisation.
They were also unsure about how to effectively complete the documentation process, given that they were just a month away from the hard deadline for submission. The client was based out of Canada with a time difference of 8 hours, which further posed challenges in communication. Also, the client’s accountants were undertaking tax filing for the first time so were not fully aware with the process.
ResearchQX was engaged to provide SR&ED assistance to the company for the first time and it was an urgent closure for them.
Our Process
ResearchQX initiated the claim analysis process by presenting the detailed guidelines on SR&ED to the client and discussed eligibilities of their projects undertaken in the filing year. The client had mostly worked on plastic moulding innovation, from material development to structural design, and manufacturing optimisation. Basis on these discussions, the eligible project activities were understood, and their relevant staff eligibilities were accessed.
Even though the client was in British Columbia and was 8 hours behind our technical team in the United Kingdom (and twelve and a half hours behind our India Project Delivery team), we were still able to establish a smooth communication with them to understand all project information and direct them through the claim process.
Due to the client’s preoccupation with several other projects, ResearchQX received all data just near the hard deadline, but with our teams working across different time zones, the client was assisted with a quick turnaround time on high priority.
Adding further complications to the claim process, the client discovered that their accountant had never incorporated SR&ED claim numbers in corporation tax return before and was lacking confidence to do so. Just a week before the hard deadline, the client decided to hire a new accountant due to the complexity of the CRA's rules regarding SR&ED submissions via tax return. The process of finding an accountant with past SR&ED experience in such a tight timeframe was extremely difficult, but ResearchQX was able to do so by leveraging its connections with other Canadian businesses. The accountant referred by us assisted the client on priority in finalising the SR&ED tax filing. The claim was finally submitted to CRA for their review in due time and was approved with no questions raised by the inspector.
Key Metrics
The client has benefitted from our comprehensive assistance in closing an urgent first-time tax claim for them. Overall, the competent professionals got a better understanding of the claim process and calculating eligibilities for their future claims.
