Frequently Asked Questions.
We'll answer your questions the best we can
What is Advance Funding of SR&ED tax credits?
SR&ED Advance Funding is a loan against a future SR&ED refund.
What is a SR&ED tax credit and refund?
The SR&ED investment tax credit is an incentive program run by CRA that entitles companies to claim 35%+ of their eligible expenditure in the form of a tax reduction or a cash payout. This refund can only be claimed after the completion of the fiscal year in which it was incurred.
What companies qualify for the SR&ED tax credit?
Companies that have strong investments in complex technology or R&D qualify. If you're looking for more detail, the CRA goes in-depth about which activities quality.
What is the minimum and maximum you will advance?
There is no minimum or maximum amount in which you can advance.
How do I pay interest and repay the loan?
Interest and principal are paid off when you receive your payout from the CRA.
Is the first part of the facility fee refundable?
It is refundable in the rare instance where Prime Funding declines your loan request.
The facility fee is non-refundable in instances where the client decides not to go ahead due to them changing their mind, or deciding to go with another provider after we have already met with them.
Can I continue using my existing SR&ED consultant?
Yes you can! If you decide to use our services, we will work alongside your consultant to keep track of your SR&ED projects throughout the year.
Can a first time SR&ED filer be advanced?
We do not typically advance a first-time SR&ED claimant. But if you have gone through a company restructure, or have a venture capital investment, then we will be able to offer financing for your company.
Why would I take out a loan when I can just wait for my refund?
This is a question of Return on Investment (ROI). Our most successful clients use Advance Funding to accelerate growth or capitalize on an opportunity. Founders who have started more than one company immediately understand the value in non-dilutive funding. Here’s an example (we have many more):
A loan of $100,000 could be used to bring on two developers for a few months, accelerating your product dev, beating your competitors to market and boosting user numbers. You now have a solid case and real numbers to present to VC’s, all on an accelerated timeline. By spending a small amount on Advance Funding, you’ve increased the value of your company significantly.