Funding is a key challenge for
technology start-ups. Often, early-stage companies rely on
bootstrapping until they develop to a point where they are able to
raise equity through Series funding. However, there are a variety
of government programs that can ease this transitional burden by
providing funding. Scientific Research and Experimental Development
(SR&ED) is one of the most common sources of government funding
for technology companies, but it by no means the only money out
there. Other programs often come in the form of wage subsidies, as
they are focused on trying to create jobs for Canadians, but other
government grants and credits exist.
Some programs, like SR&ED,
offer funding if you meet the eligibility requirements. But other
programs are competitive and require applications, as there is a
limited pool of grant funds. Having a business plan and a prototype
increases the chance of success with these programs.
A sampling of the programs available:
IRAP can provide grants to small to
medium sized technology companies with the potential to grow. There
is an application process. IRAP can also assist in business
development with consulting by using their industrial technology
Corporations that develop
interactive digital media products in British Columbia can be
eligible for this credit, which is equal to 17.5% of salaries and
wages. Games and educational software are types of products that
can qualify. There is an application process, and if approved, the
refundable credit is claimed on your corporate income tax
Offers a $2,700 grant for hiring
first-year co-op students for technology companies.
As you see, there is a lot of
non-SR&ED government funding available, but it requires
awareness and time to apply. Each program has their own eligibility
criteria, some of which are general, and some of which are
technology specific. Some of the more competitive grants can be
difficult to get. The application process is time away from
developing your core business, so you should consider only pursuing
grants that you have a higher chance of obtaining.
For a summary of programs available
in different provinces and territories, click here.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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