Tweet
How To Win The War On The Wait For Your SR&ED Refund
OVERVIEW – Information on sr&ed financing in Canada. The ability to finance a sred claim provides valuable closure to your r&d capital investment . That closure? Cash!
There is another option . As a Canadian business owner and financial manager you may have chosen to ‘ book ‘ your SR ED claim as an account receivable – money owing to you, that is non- payable , from the government . Some of our customers choose to book the claim as an asset/receivable, some choose not to, or in some cases they book a conservative estimate of their final cheque .
Assets can be financed – your SRED claim is an asset, and is in effect a receivable, somewhat longer in nature than you other receivables ( hopefully ). Those Canadian firms that have bank lines in place have probably realized by now that most chartered banks in Canada do not include your SRED claim as a true receivable .
So, can that receivable be financed and monetized ?? It absolutely can, via the process of SR ED financing . We hear more often than not the term ‘ factoring ‘ in business – which is, of course, the sale of a specific, or group, of receivables .
That’s what SRED financing is about . A carefully constructed SRED financing allows you to ‘ cash in ‘ – the finance people say ‘ monetize ‘ the SR ED claim . That’s valuable cash flow that might not have come into our working capital for many months, in some cases a year based upon the timing of your filing, the complexity of the claim, the technical audit, etc .
We strongly recommend to business owners that if they are looking to finance a SRED calim that they work with an experienced and trusted advisor in this area .
Whenever we meet with a client or business owner who wishes to inquire about our SRED financing work the company invariably wants to know several key things –
How does it work?
What does it Cost?
How much do I get on the claim?
What’s involved ?
When do we get our funds?!
Lets discuss those issues in a general way, we honestly think our comments will apply to almost 95% of SRED financing claimants . You want facts? We’ll give you the facts ! –
SRED 101 – Everything you wanted to know about SRED Financing, but were afraid to ask .Your SRED claim is sold/assigned to the financier - Similar to the factoring practice of selling a receivable you sell your claim for the purposes of getting the cash – it’s a sooner rather than later scenario ! SRED financing is a form of alternative financing, rates vary with the size and complexity of the claim, rates are higher than bank financing .
In our experience firms financing their SRED’s are totally focused on generating additional cash flow and working capital so they can continue to grow sales and profits. Claims are financed at approx 70% of their LTV. By LTV we mean loan to value, so a company filing a 300,000.00$ SRED claim would receive 210,000.00$. The balance owing to you, (less financing costs) is funded when the claim is finalized and paid by CRA – Revenue Canada.
Oh, and what’s involved? In our work with clients we maintain that a SRED financing is not unlike any other financing: an application, some backup information, some due diligence around your company and your SRED, then documentation, and you’re funded. We typically have been able to originate and complete financings for our clients in 2-3 weeks.
Bottom Line ? Sr&ed Financing is a viable and valuable alternate form for working capital financing in Canada! Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your tax credit financing needs .
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Direct Line = 416 319 5769
Office = 905 829 2653
Email = sprokop@7parkavenuefinancial.com
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 .
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
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.