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Does my company qualify for the R&D Tax Credit?

Listed below are some of the most frequently asked questions our team receives about R&D tax credits

Does my company qualify for the R&D Tax Credit?

R&D Tax Credits can be claimed by businesses in a number of industries, including software development, manufacturing, life sciences, engineering, architecture, food & beverage, aerospace & defense, and agriculture. Any company can claim R&D Tax Credits as long as they are undertaking activities that meet the requirements of the 4-part test:

  • Permitted Purpose: In simple terms, the purpose of the activity or project must be to create something new, or improve upon a product, process, software, invention, patent, or formula (referred to as a business component). The permitted purpose falls under a broad umbrella that includes improving functionality, performance, reliability, or quality of the business component. 
  • Elimination of Uncertainty: The activities and project in question must attempt to eliminate uncertainty related to the optimal design, development methodology, or component’s capability to achieve the permitted purpose.
  • Process of Experimentation: Substantially all of the activities constitute elements of a process of experimentation. The activities must include a systematic evaluation of alternative solutions to eliminate the technical uncertainty through, for example, trial and error or a Product Development Lifecycle (“PDLC”).
  • Technological in Nature: The activities and process of experimentation must rely on the fundamental principles of the hard sciences, including biology, computer science, engineering, physics, or chemistry.
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