Canadian small and mid-sized businesses (SMBs) are often confronted with difficult innovation challenges. Implementing research and development projects helps to increase product and process innovation, however engaging in these projects can often be lengthy, financially demanding, and requiring a diverse team of skilled employees. Since many small businesses often lack the resources or cash flow to pursue innovative projects, the National Research Council of Canada (NRC) offers a range of Canadian government grants for research to help small businesses complete critical research and development activities.
The Accelerated Review Process (ARP) stream of Industrial Research Assistance Program (IRAP) increases business innovation by providing up to 50-80% of eligible project expenses to a maximum $50,000 for projects that revolve around solving an internal technical challenge. IRAP’s ARP research grants cover a portion of labour, as well as third party contractor expenses. The applicant needs to apply and be accepted before commencing their project, which we recommend doing as part of a proactive funding strategy.
Business Eligibility for IRAP ARP Research Grants
IRAP ARP research grants can be accessed by business owners and executives across Canada. IRAP receives funding at the beginning of each government fiscal year (April 1st) and ARP projects can occur anytime within that fiscal year (April 1 to March 31). Businesses eligible for this Canadian government funding program must:
- Maintain 1-500 full-time employees;
- Be a for-profit entity;
- Be federally incorporated for at least two years; and
- Be dedicated to future research and development activities.
Projects Eligible to Receive IRAP ARP Research Funding
IRAP ARP projects will mainly focus on solving internal technical challenges, such as process or product/technology improvements. Companies completing research projects that lead to new products, enhanced productivity, or new competitive advantages will be given priority access to funds. Types of projects that qualify for this program include:
- Product prototyping, development, or enhancements;
- Business process mapping;
- Supply chain diversification;
- IP (internet protocol) assessments, planning, and strategy development;
- New technology/ market feasibility studies; and
- Advanced technology adoption and adaptation.
Please Note: IRAP ARP projects should start and finish within one government fiscal year, which runs from April 1 to March 31 of the following year. Projects larger than $90,000 or spanning longer than one year in duration should consider applying for IRAP Mid-Size Projects funding.
Eligible Expenses to Submit for IRAP Government Business Grants
The Accelerated Review Process (ARP) stream of IRAP is mainly focused on supporting two types of expenses with research grants:
- Internal Labour Expenses: up to 80% of technical employee salaries covered; and
- Third Party Contractor Fees: up to 50% of invoiced labour-based expenses.
Please Note: Project expenses made prior to IRAP ARP program approval will NOT be eligible towards final funding contributions.
Expenses Unable to Receive IRAP ARP Funding Grants
Any non-labour related fees will ultimately be deemed as ineligible to receive funding. Included in this classification are common project expenses such as:
- Employee training; and
- Certification costs.
When to Apply for IRAP ARP Research and Development Funding
SMBs who have met the eligibility requirements for IRAP ARP grants may choose to begin the program’s application process. Especially for IRAP programs, understanding when to apply for funding will help businesses to access these funds.
The program will receive a top-up of funds at the start of their fiscal year and award grants until all funds have been invested. Businesses are advised to submit project proposals, including a company overview and an innovation plan, at the start of NRC’s fiscal year on April 1 to ensure priority access to the funds.