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If an acronym has an ampersand in it, you know good times await. This little moniker, SR&ED, stands for Scientific Research and Experimental Development, and it refers to a tax credit and/or cash refund that your small business may qualify for if it conducts research and development in Canada.

I really like this program, which many refer to as "shred" for the ease of pronunciation. I must admit, however, that I was intimidated when I first heard it spelled out.

I was drawn to the "shred" term by associating it in my head with fast rock guitar playing but, as the correct wording of the program was explained to me, I immediately imagined that, to quality for something with "scientific" and "research and development" in its name, I'd need a business full of Bunsen burners, staff with lab coats, racks of test tubes and possibly a project involving outer space.

Not true. Any small business in any industry can qualify, as long as the work you are doing, and the expenses related to that work, are spent trying to advance products or processes in ways that have unpredictable outcomes.

Qualifying companies can receive up to 35 per cent back from the Canada Revenue Agency (which administers the program) on approved, SR&ED expenses such as such as wages, materials, machinery, equipment, a portion of overheads, and some subcontracting. The work needs to be performed in Canada to qualify.

Now, many entrepreneurs I know find government funding or tax-credit applications too onerous, time-consuming and complicated. This program however, is about as straightforward as you could expect, has a very reasonable set of rules for application-submission deadlines, and a very reasonable turnaround time.

Ignore this program at your peril as it can help your ultimate competitiveness locally and globally.

The application requires a science report that explains the work you did and why it qualifies, as well as a financial report on what you paid to whom relating to what work.

The first year I applied for an SR&ED credit, I hired an outside consulting company to do the application for me with information I submitted. After witnessing the results of the reports following the first year, however, I realized that I wanted to write the science report myself, to make it as clear and concise as possible, and just have my accounting firm double-check the finance piece.

You have 18 months after the end of the year in which you did the work to submit your application. That's perfectly reasonable.

After my positive first experience, and knowing I was still doing qualifying work, I kept better records throughout the following year with an SR&ED application in mind, which cut down on the information digging I had to do at the end of the year.

I found the payment turnaround fair and – how can you complain when you are doing work you probably would have been doing anyway? The credit allowed me to do more research, faster, in the following years – exactly the result I suspect the government would like to see.

So, while I stand behind my admiration for this program, I really want you to judge for yourself. I encourage you to visit the SR&ED website to see how it may apply to your small business.

Every tool in your toolbox needs to be leveraged fully in order to excel in your pursuit of uniqueness and greatness. This program very well may be one of those tools.

Special to The Globe and Mail

Chris Griffiths is the Toronto-based director of fine tune consulting, a boutique management consulting practice. Over the past 20 years, he has started or acquired and sold seven businesses.

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