SR&ED Just Tripled Its Ceiling: What Bill C-15 Means for Your 2025 and 2026 Claim

On March 26, 2026, Bill C-15, the Budget 2025 Implementation Act, received Royal Assent. Buried inside it is the largest change to the SR&ED program in over a decade: the expenditure limit for the enhanced 35% refundable credit jumped from $3 million to $6 million.

If you run a Canadian-controlled private corporation doing technical R&D, this is not a minor adjustment. It is the difference between a maximum federal refundable credit of $1.05 million and one of $2.1 million, before Quebec or any other provincial credit is added on top.

Here is what actually changed, who qualifies, and why your bookkeeping matters more now than it did before the ceiling moved.

What Changed, Specifically

The SR&ED program has always had two tiers. Canadian-controlled private corporations (CCPCs) get a fully refundable 35% credit up to an expenditure limit. Anything above that limit, and everyone else, gets a 15% non-refundable credit. Bill C-15 touched the first tier in four ways.

• Enhanced 35% expenditure limit: $3,000,000 before → $6,000,000 after Bill C-15
• Maximum refundable credit: $1,050,000 before → $2,100,000 after Bill C-15
• Taxable capital phase-out range: $10M to $50M before → $15M to $75M after Bill C-15
• Eligible Canadian public corporations (ECPCs): not eligible for the 35% rate before → eligible up to $6M, phased out by 3-year average gross revenue between $15M and $75M
• Capital property for SR&ED: generally ineligible since 2014 before → reinstated for property acquired on or after December 16, 2024

CCPCs also gained a new option: instead of being measured only on taxable capital employed in Canada, you can now elect to have your expenditure limit calculated using your average gross revenue over the preceding three fiscal years. For a company with low taxable capital but high revenue, or the reverse, this election matters. Run both calculations before you file.

These changes apply to taxation years that begin on or after December 16, 2024. If your fiscal year started anytime after that date, the new limit applies to that year's claim, even if you already filed it under the old rules. The Canada Revenue Agency has indicated that SR&ED forms and policies are being updated to reflect the legislation, with guidance expected through 2026.

Why This Happened

The expansion did not appear overnight. The federal government first proposed raising the limit to $4.5 million in the December 2024 Fall Economic Statement. That proposal stalled when Parliament prorogued, then was revived and pushed further, to $6 million, in Budget 2025. Bill C-15 is the legislation that turned the proposal into law.

The stated goal is straightforward: keep more cash inside scaling Canadian companies during the years they need it most. A $3 million ceiling made sense for a five-person startup. It made far less sense for a 40-person SaaS or biotech company spending $4 million a year on engineering and lab salaries, who was getting bumped down to the 15% non-refundable rate on every dollar past $3 million. The new $6 million ceiling, paired with the wider taxable capital and revenue phase-out bands, is built for exactly that growth stage.

What This Means in Practice

Run the numbers for a mid-stage CCPC with $4.5 million in qualified SR&ED expenditures.

Under the old rules: the first $3 million earns the 35% refundable rate ($1,050,000). The remaining $1.5 million earns the 15% rate, partially refundable depending on prior-year income, worth roughly $225,000 in non-refundable credit.

Under Bill C-15: the full $4.5 million falls under the $6 million enhanced limit. At 35%, that is $1,575,000 in fully refundable credit, an increase of over $300,000 in cash back, on the same R&D spend.

For an eligible Canadian public corporation that previously could not access the 35% rate at all, the change is even more significant: a brand-new path to refundable credits that did not exist before.

The Part That Has Not Changed: Documentation

A bigger ceiling does not mean a lower bar. The CRA still requires contemporaneous documentation: timesheets, project records, and a chart of accounts that separates eligible R&D from regular operations as the work happens, not reconstructed at year-end. With a maximum claim that just doubled, the cost of a sloppy claim, in CRA review time and in dollars left on the table, also doubled.

A few things worth checking before you file:

• Payroll segregation. Can your payroll system isolate hours spent on documented SR&ED projects versus maintenance, support, and commercial feature work, by employee, by month?
• Chart of accounts. Is your R&D infrastructure, dev environments, specialized cloud compute, testing tools, sitting in its own ledger account, separate from general SaaS subscriptions?
• Government assistance offsets. If you also received NRC IRAP funding or another government contribution for the same work, your SR&ED qualified expenditure pool gets reduced dollar for dollar for those costs. The two programs can be claimed together, but they have to be coordinated, not stacked blindly. NRC IRAP is also expected to be folded into the new Canada Innovation Corporation over the next funding cycle, so confirm program status with your NRC advisor before you plan around it.
• The revenue election. If your taxable capital is high but your revenue is moderate, run the new gross-revenue-based expenditure limit calculation. It may unlock a higher limit than the taxable capital method.

We cover the full mechanics of building SR&ED-ready financial infrastructure, granular chart of accounts, payroll segregation, contractor documentation, in our founder's guide to SR&ED in Quebec. If you are in Quebec, also check whether your claim stacks with the CDAE e-business tax credit, since the two programs target overlapping but distinct activities.

Should You Refile a Prior Claim?

If your fiscal year began on or after December 16, 2024 and you already filed a SR&ED claim under the old $3 million limit, it is worth checking whether an adjustment is available. The window to request an adjustment to a previously filed T2 is generally three years from the date of the original assessment, so this is not an urgent same-week task, but it is also not something to forget about. Talk to whoever filed your claim, your SR&ED consultant or your accountant, about whether your specific tax year qualifies for a reassessment under the new limit.

The Bottom Line

Bill C-15 doubled the ceiling on the most valuable non-dilutive funding program available to Canadian tech and biotech companies. It did nothing to lower the documentation standard required to claim it. Companies whose books were already structured to isolate R&D spend will simply claim more. Companies whose books were not will find that a bigger opportunity just made a messy claim more expensive to clean up after the fact.

If your finance function was not built with SR&ED in mind, schedule a discovery call and we will walk through what your chart of accounts and payroll setup need to look like to capture the new limit without a year-end scramble.

Frequently Asked Questions

Does the new $6 million SR&ED limit apply to my 2025 fiscal year?

It applies to any taxation year that begins on or after December 16, 2024. If your 2025 fiscal year started on or after that date, the new limit applies. Check your specific fiscal year-end against that date before assuming either way.

I already filed my SR&ED claim under the old $3 million limit. Can I get the difference back?

Possibly, if your tax year qualifies under the new effective date. CRA generally allows adjustments to a filed T2 within three years of the original assessment. Confirm eligibility with your SR&ED consultant or accountant before assuming you missed the window.

Can I claim both NRC IRAP and SR&ED for the same project?

Yes, but not on the same dollars twice. Any IRAP contribution you received for a specific cost reduces your SR&ED qualified expenditure pool for that cost, dollar for dollar. The two programs are complementary when coordinated properly, since SR&ED often captures eligible activities that IRAP did not fund.

Does the higher limit change what counts as eligible SR&ED work?

No. The definition of eligible work, systematic investigation aimed at resolving technological uncertainty, is unchanged. Only the dollar ceiling on the enhanced refundable rate and the phase-out thresholds moved.