Members of the Canadian federal government announced a blueprint regarding the creation of a new Canada Innovation Corporation (CIC). Made public in February 2023, Chrystia Freeland, Deputy Prime Minister and Minister of Finance, and François-Philippe Champagne, Minister of Innovation, Science and Industry, presented the plans for realizing the CIC in 2023.
“The global economy is changing, and with smart investments today, we can help create more good jobs for Canadian workers. By supporting Canadians and Canadian businesses in turning their new ideas and technologies into new products, services, and growing businesses, the Canada Innovation Corporation will help build a stronger and more innovative Canadian economy.”The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance
As part of the CIC’s mission to advance Canadian business investment in research and development (R&D) and promote economic growth, the government will establish an innovation agency to drive business investment in R&D.
Canada Innovation Corporation (CIC)’s budget over the next four years will be $2.6 billion. It will begin operations in 2023.
“The key to growing Canada’s economy and creating good jobs is increasing investment in research and development and supporting new technologies that will help drive growth. The new Canada Innovation Corporation will help increase the productivity and competitiveness of Canadian businesses all across Canada, positioning them for commercial success and cementing Canada’s position as a global leader.”The Honourable François-Philippe Champagne, Minister of Innovation, Science and Industry
Canadian research facilities boast some of the world’s most talented people, and there are countless companies in commodity-based and traditional sectors that could transform into technology-driven global leaders as well as robust start-up ecosystems across the country. An innovative and stronger economy is within reach for Canada.
Providing funding and advisory services to new and established Canadian firms, the Canada Innovation Corporation (CIC) will work with the private sector to provide enhanced support to make develop new and competitive products, processes, and services.
As the global economy changes, the CIC will work independently to help Canadian businesses innovate, commercialize, grow, and create jobs.
Government Funding for Research & Development in Canada
By investing in research and development with programs like Canada Innovation Corporation (CIC), Canadian companies can achieve competitive advantages over their international and domestic competitors. Researchers and large businesses with substantial R&D budgets can undertake these activities as can smaller companies seeking an innovative edge over existing products and services in their sector.
For businesses to stay viable, they must adopt an innovation mindset; without research and development, your client base will eventually seek out more appealing options than what you have to offer. Companies can stretch their research budgets thanks to Canadian government funding that offsets R&D costs.
Visit our Research & Development Funding Directory to see a comprehensive list of the top government funding programs, like Canada Innovation Corporation (CIC), available to Canadian businesses operating research & development activities.
Leveraging The Scientific Research and Experimental Development (SR&ED) tax credit
A major source of federal support to business-led research and development is the Scientific Research and Experimental Development tax credit (SR&ED). Approximately 20,000 claimants each year receive tax incentives totaling more than $3 billion.
Tax credits for labor and overhead expenses of up to 69%, contractor expenses of 36%, and material expenses of 45%. Research and development expenses must be aligned with the needs of the company’s scientific research and experimental development.
Researchers must conduct either basic, applied, or experimental research in Canada and develop new products, processes, or make incremental improvements.
Costs such as labour, contractors, materials, and overhead that directly relate to and are commensurate with the activity required to address technological uncertainty, obstacles, or challenges are eligible expenditures.
A qualifying expense must be reported within 18 months of the end of the tax year in which it was incurred.
You can also learn more about the SR&ED tax credit by watching our SR&ED overview video below.
Get Started with Government Funding for Research and Development Today
Check out our comprehensive government funding directory if your business would like to learn more about government funding opportunities. To learn more about the top government funding programs available to companies across a wide range of industries, businesses, and more, we highly recommend attending one of our free government funding webinars.
Last but not least, sign up for our free government funding newsletter to be the first to know about new grants, loans, and tax incentives in your industry.