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Sr&ed Program - Going Going ..Who Knows : SR&ED Financing - Here!
OVERVIEfW – Information on the financing of refundable tax credits in Canada. The SR&ED program provides valuable capital to businesses investing in r&d capital programs - SR ED Bridge loans make sense - here is why !
Top experts tell us that in the last 7 years payouts on SR&ED claims have reduced by over 5 Billion dollars - suffice to say billions are still being paid on thousands of current claims. The gov't seems to be asking anyone with interest to provide guidance on the future of the program.
Business owners hate uncertainty. Who doesn’t? The one constant in SRED? Cash Flowing Your Claim!
SR & ED (SR ED) factoring is a viable consideration for any Canadian company that files SR ED claims and is looking for additional working capital. Not all Canadian business owners and financial managers are aware that SR ED claims can be monetized (financed!).
For an overview of SR ED financing it’s important for us to validate some of the basics -
- Have you filed a SR ED CLAIM?
- How much was the dollar amount of the claim
- Who prepared the claim?
- What amount of cash or working capital do you need in conjunction with the claim filed?
If you are looking for cash flow with respect to your Canadian SR ED claim you either have working capital financing in place now with your bank or finance firm (a factoring company perhaps) or your firm is self financing and you are looking for the SR ED to supplement additional cash flow.
Canadian business owners and financial managers are aware that when they finance their receivables and inventory these ' current assets ' are' margined ‘. By margining we of course mean the amount of funds you can borrow against these assets.
In SR ED financing you are generally financed 70% of your claim, and that is the combined total of the Federal and Provincial claim.
So if you have filed a SR ED claim, of say, for example, $ 350.000.oo you are eligible for 70% of that amount, or 245,000.00
Funds can be advanced as soon as you have filed the claim, but not before. Naturally it is somewhat important to ensure your claim was filed by a qualified party - usually an accounting firm or consultant. It's these consultants that are in the field daily on the program, wresting with all sorts of changes around Form 4088! ... Defining and backing up your project.
SR ED financing is outside your normal current financing arrangements. The SR ED is collateralized separately - it is in essence a short term working capital loan that is repaid when the government sends you your chq, Most Canadian business owners do not want to wait, 3, 6, 12 months of more for a cheque for a substantial amount that is in effect a non repayable grant from the government. The Canadian government continues to pour well in excess of a billion dollars into the program, and if your firm qualifies for a SR ED claim -
1. Why wouldn’t you use the program?
2. Why wouldn’t you accelerate the cash flow from the grant by financing your SR ED claim?
SR ED financing is a boutique small industry in Canada - business owners are cautioned to work with a qualified, credible, and experience party who will ensure they are maximizing financing capabilities under the program.
In summary, Canadian firms who are eligible to file a SR ED claim. should do so. What firm would not want to receive a cash non repayable cheque from Ottawa! If you can wait for the funding, and don’t need additional cash flow, great, if you wish to arrange interim financing for your claim enlist the services of a trusted and credible SR ED financier. In a matter of a couple of weeks your working capital and cash flow will be augmented vis a vis your SR ED financing. SR ED Financing and factoring - a great Canadian alternative financing strategy.
7 Park Avenue Financial :
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .
7 Park Avenue Financial
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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