Sr Ed R and D Financing And Film Finance Credit Bridge Loans Are Cash Flow Power : Here’s How

Drawing A Blank On Tax Credit Financing In Canada?

R&D And SR&ED Bridge Loans And Media Tax Credits



OVERVIEW – Information on sr&ed and film finance credit finance solutions. SR ED bridge loan r and d financing and media tax credits provide solid cash flow solutions



SR ED R&D financing , as well as the film finance credit often has some clients we meet ' drawing a blank' when it comes to how to monetize either one of these two significant programs.

The reality is that either tax credit provides significant cash flow power, and the ability to finance you credits either before, or after they are filed represents your ability to beat the 'waiting game’ as it pertains to the government approving, and processing your refund chq. Let's dig in.

The SR&ED program, for those who follow or have a vested interest in it has been turned upside down and inside out in the last year or two. It got to the point where the govt did what they do well (?), which is commissioning a report on the validity and benefits of the program to the govt and claimants.

Given that the government provides funds for these two programs in the Billions of dollars it's no surprise the R&D credit program came under significant scrutiny. Since the thousands of claimants under the program are in the SME (small / medium enterprise) sector they have become significantly dependent on the program the changes out of the government study (‘The Jenkins Report') were fairly dramatic, both positive and negative. They included:

Significant emphasis on the real government ' pay back' on the program

Simplification of the application process

Elimination of certain of the credits under the program - i.e. capital expenditures (The main deductions center around payroll and contractor expenses)

Strong focus on who exactly is preparing the claims (aka ' Sred Consultants') and how compensation is charged

The program is primarily for private firms and doesnt discriminate when it comes to industry, geographical location,


FILM TAX CREDIT FINANCING:

While some might say the SR&ED program doesnt maximize Canadian investment in research the converse is probably true when it comes to the film finance credit. (Film finance credits include movies, TV, animation and digital effects) The ' Hollywood North' nickname for Canada didn’t come by chance; hundreds of productions have been filmed or produced here because of the tax credit investment climate.

The three largest cities, Vancouver, Toronto and Montreal all have booming media business.

The financing challenges on any project in any media category are significant. The right film tax credit, when maximized with the assistance of a good tax credit accountant delivers anywhere from 30-50% of total financing required.

The 3D industry is a booming example of the Canadian film industry. Spending by Cdn and co production partners is in well over a billion dollars in VFX areas.

FINANCING YOUR SR&ED or FILM TAX CREDIT:

Tax credit financing is most often structured as a bridge loan. To the benefit of the borrower no payments are required during the duration of the loan and the loan is collapsed as soon as your refund chq comes in. While some banks participate in this type of financing many producers and foreign co production partners seek commercial financing expertise outside the banks.
If you are looking for true financing of a SR ED or Media tax credit seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with your cash flow needs in this area.



Stan Prokop - 7 Park Avenue Financial :

http://www.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 90 Million $ of financing for Canadian corporations . Info /Contact :


7 Park Avenue Financial = Canadian SR&ED And Film Tax Credit Financing Expertise!






Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Direct Line = 416 319 5769
Office = 905 829 2653

Fax = 905 829 2653

Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Financing SR ED Credits And The Film Finance Credit : Eliminating Performance Anxiety

Here Are All The Ways To Finance Tax Credits ( SR&ED / Film ) In Canada - It’s A Science Not A Séance

OVERVIEW – Information on financing SRED ( ‘SR&ED’) credits in Canada . Together with the Film finance credit the ability to monetize and cash flow refundable tax credits accelerates business success in research and Media






Financing SRED credits (SR&ED) or the Film Finance Credit shouldn’t come with ' performance anxiety’! Let's discuss some of the key issues/points around maximizing tax credit claims under these two major programs. In our ( humble ) opinion these two programs , which provide Billions ( yes that's with a ' B' ) of refundable credits and ' cash back' need to be maximized and provide great recovery of cash flow and working capital . Let's dig in.

It might seem strange to some that we talk about R&D recovery and film/TV/digital animation tax credits in the same breath but the similarities of the two programs in what’s required to file and what’s require to finance are quite uncanny .

Let's take a look at SR ED (The Scientific Research / Experimental Development) first. When it comes to financing and tax credit, and SRED is no exception it’s about the quality of the claim. While we meet some clients who are comfortable and knowledgeable in writing and filing their research credit the fact is that the majority of these claims are prepared by 3rd parties called SRED consultancies.

This group of folks created a small industry over the years, billing their clients on contingency and taking all the risk in preparing and filing your claim. What a nice bunch of folks right? Well, in return they typically took 15-30% of all funds recovered. We won’t get into the merits of what's fair and reasonable, as thousands of firms over the years certainly felt this was an ok arrangement. But these days you're required to align yourself with a credit SR&ED consultant, as well as divulging on your filing who prepared the claim and what the fee was.

When it comes to financing your claim your SRED credits are evaluated under a small handful of key criteria - i.e. general stability and prospects of your firm, owner experience, previous filings ( nice to have , but not required ) , and as stated, quality of the claim . So aligning yourself with a solid preparer is key.

Since financing a tax credit claim in both SR&ED and film is all about shortening the time it takes to receive your funds a quality claim will shorten audits, requests for info, as well as speed up financing approval, which typically only takes days anyway.


When it comes to the film finance tax credit it's key to know that financing media tax credits is one of the most straightforward and less 'risky' aspects of the ' exciting' (?) world of media entertainment production . While many might view this industry as ' losing a shirt' and dependent on public success the reality is that the tax credit portion of a project in film, television or transmedia provides anywhere from 30-50% of an entire budget , and when properly financed allows the other portions of a project to come together quite nicely - i.e. equity,. Pre-sales, gap, etc.

The film tax credit accountant mirrors the role of the SR&ED consultant - providing a quality claim via their expertise in the various provincial and federal programs that are combined into your filing.

In our opinion financing sred credits and the film finance credit is an art and science, not the mystery of a séance. Seek out and speak to a trusted credible and experienced Canadian business financing advisor who can assist you with eliminating ' performance anxiety '

in tax credit financing.



Stan Prokop - 7 Park Avenue Financial :

http://www.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 90 Million $ of financing for Canadian corporations . Info /Contact :



7 Park Avenue Financial = Canadian SR&ED and Film Tax Credit Financing Expertise









Stan Prokop









Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial
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


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop