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We Just Killed 2 Birds With One Stone When It Comes To Cash Flowing Your SR&ED Credits
OVERVIEW – Information on how to finance CRA tax credits in Canada. SRED finance is an accepted form of cash flowing your SR&ED refundable tax credits
The ability to ' unlock’ the cash flow represented in your SR&ED claim is a key part of the working capital challenge undertake by firms who participate in the Scientific Research & Experimental Development ( SR&ED ! ) program .
We're all familiar with the age old expression... 'Pay me now or pay me later '. In the case of sred financing it becomes a similar question ' should I wait for my cheque from the government, ( which could actually take potentially a year or more ) or should I finance that claim and put that cash back to work now .
The importance of your R&D Capital investment keeps you competitive, so why not re invest those funds and get them working?!
When you finance your sred claim you are in effect discounting, selling, or we can even use the word 'factoring 'the claim. You may or may not have chosen to book the sred as an account receivable, that's your call, But ... we can assure you if your claim is valid that it is a true receivable and can be monetized for cash flow and working capital now.
In general in Canada banks and tier one institutions do not finance sr&ed claims, so special expertise is required. The entire process can be completed in a matter of a couple weeks, and we often liken the sred financing process to any other business financing that you would contemplate - meaning:
Determine you are eligible for the sred program
Prepare a claim
File a claim - ** Remember claims don't need to be fully filed or completed to be financed
We hate to hit you with another age old cliché, that being 'time is money ', but quite frankly the essence of our info focuses on that statement. By that we mean that if you have a sred claim, and you have filed it already, and you are days, weeks, or perhaps a month or so away from getting your cheque, well... clearly it might not make sense to finance your claim.
However if you haven't filed your claim yet, or you have just filed it and haven't had a technical or financial audit on the claim then clearly if you need the cash flow back from your r&d investment then consider financing the claim .
So consider financing your claim and taking advantage of the opportunity cost of capital involved in using your SRED cash. Most firms can use cash to help generate sales, profits, and re-invest in more R&D capital expenditures.
The SR&ED program is probably the best government support program out there for Canadian business and industry. Take advantage of your share of the billions of dollars that go out to you in the form of non repayable grants for your investments. If it makes sense finance the claim and accelerate your cash flow and working capital.
Stan Prokop - founder of 7 Park Avenue Financial –
Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 13 years - Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing. Info & Contact Details :
http://www.7parkavenuefinancial.com
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Office = 905 829 2653
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.
Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.
Stan Prokop
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