Two Methods to Calculate SR&ED Overhead Expenditures

Overhead Cost Proxy method

• Estimation method - 55% of salaries or wages claimed
• Easier than Traditional Method
• Can be more generous than accounting methods

 

Overhead Cost Traditional method

• Exact accounting method
• Directly related to conducting SR&ED that would not be incurred if SR&ED was not conducted - incremental
• Directly attributable to providing premises, facilities or equipment to conduct SR&ED in Canada
• May be advantageous for claims with lower salaries or wages

 

You can change the method only in subsequent years.