For businesses planning to claim the Scientific Research and
Experimental Development (SR&ED) investment tax credit, two tax
measures need to be considered to maximize this tax credit.
Innovation Employment Grant
The Alberta 2021 Budget, tabled on February 25, included the
Innovation Employment Grant (IEG), which encourages economic growth
by supporting small and medium-sized businesses that invest in
research and development (R&D) across sectors.
The IEG was designed to replace the Alberta SR&ED tax
credit, which was eliminated starting in 2020. The IEG provides an
8 per cent payment on a corporation's base level R&D
spending in a year. The base level spending is calculated as the
average R&D spending of the corporation in Alberta over the
previous two years. Corporations that spend over their base level
will be eligible for a payment of 20 per cent on the incremental
amount. Start-up businesses moving to Alberta could receive the 20
per cent payment on their
