R&D Tax Credits - Reviews, Objections and Appeals
When your R&D tax credit claim is brought into question, experienced representation matters.
A claim selected for review is not necessarily a claim with something wrong. There may be a request for additional information to determine whether the work qualifies or whether the expenditures claimed are allowable.
Nevertheless, a review can be demanding. Technical explanations, financial records, supporting evidence and the way information is presented can all affect the outcome.
And when a review leads to a disagreement, there may be further avenues available through the objection and appeal processes.
We help Canadian businesses navigate these situations with experienced technical and financial judgement, a clear understanding of the evidence and a practical appreciation of the commercial consequences. This includes claims under the Scientific Research and Experimental Development (SR&ED) programme and dealings with authorities such as the Canada Revenue Agency (CRA).
When might you need our help?
Your claim has been selected for review.
You have received correspondence requesting information, arranging a meeting or questioning particular aspects of your claim.
We can help you understand the issues under consideration, organise the necessary evidence, prepare your technical and financial personnel, and represent your business throughout the review.
Your review isn't going well.
Perhaps concerns have been expressed about the eligibility of the work, the nature of the technological uncertainty, the expenditures claimed, or the adequacy of supporting documentation.
We can examine those concerns, assess the available evidence and help you determine how best to respond while the review remains in progress.
You disagree with the determination or assessment.
Where a review has resulted in an unfavourable assessment or reassessment, a formal Notice of Objection may be appropriate, depending on the applicable rules.
We can assess the disputed issues, help prepare the objection and its supporting submissions, and represent your interests during the objection process.
You're considering a legal appeal.
Where the objection process has not resolved the disagreement, litigation may be an option.
We can work alongside your legal representatives to review the technical and financial evidence, assist with preparing the factual case, and provide specialist support throughout the appeal process.
Our approach: evidence first, strategy second
Understanding the dispute
The first task is to understand precisely what is in dispute.
A disagreement about whether technological uncertainty existed is quite different from a disagreement about employee time allocations, contractor expenditures or the interpretation of a particular statutory requirement.
Assessing the evidence
We review the original claim, the relevant technical and financial records, correspondence with the authorities, and any review findings or assessments already issued.
We also speak with the people who performed the work where possible. Their understanding of what was attempted, what was known at the time, what difficulties arose and how those difficulties were investigated can be central to evaluating the strength of the claim.
With that understanding, we distinguish between matters that can be supported, matters requiring further explanation, and positions where the available evidence may be insufficient.
Choosing a practical response
We then develop a practical response, taking account of the technical issues, the applicable legislation and administrative guidance, the procedural stage of the matter, and the potential cost and benefit of pursuing a particular position.
Not every disagreement should become a prolonged dispute. Equally, a well-supported claim should not be abandoned simply because the issues are technically difficult.
Our job is to help you understand the difference.
Representation and specialist support
Representation during a review
We can act as your authorised representative in communications and meetings with the authorities, working closely with your technical and financial personnel as required.
Our involvement may include preparing responses to information requests, organising supporting documentation, reviewing the concerns, participating in technical or financial review meetings, and assisting with responses to proposed adjustments.
Where questions arise, we focus on establishing the relevant facts and explaining them clearly, rather than creating unnecessary confrontation.
Objections and appeals
A formal objection challenges an assessment or reassessment. We can assist in preparing the Notice of Objection, developing the supporting factual and technical submissions, and communicating with the authorities during the objection process.
If a matter proceeds to appeal, we work with the taxpayer's legal counsel on the specialised aspects of the case, including the factual and technical material supporting a Notice of Appeal.
This can include analysing technical records, reviewing the factual basis of disputed claims, assisting with litigation preparation and providing technical input where appropriate.
Legal proceedings require careful consideration of the issues, deadlines, evidence and costs. We help clients and their legal advisers evaluate those considerations before committing to a course of action.
What does the first engagement look like?
We begin by establishing where you are in the claim process and identifying any immediate deadlines.
We then review the claim, the supporting records, correspondence and relevant decisions, and meet with your technical and financial personnel to understand the facts.
From that initial assessment, we can explain the principal issues, the strengths and limitations of the available evidence, the possible courses of action and the work that may be required.
Where you decide to proceed, we agree on the scope of representation, prepare the necessary documentation and engage with the authorities or your legal representatives as appropriate.
The earlier we understand the issues, the more options may be available.