Borrow Against SRED Claims - Use (SR and ED) Tax Credits and Finance For Cash Flow!

In the world of finance more often than not today is better than tomorrow, and when it comes to borrowing against your SRED claims your ability to monetize SRED tax credits for working capital is the ultimate win win situation. Here is why!

The Canadian governments Scientific Research and Experimental Development (aka 'SRED', 'sr&ed') program provides in the area of 4 Billion dollars per annum to Canadian businesses in the form of a non repayable tax credit cheque. The only reason you wouldn't get your cheque is if you had corporate tax arrears, and that's still a good thing we think, because at lease then the government offsets your tax arrears with your credit. (By the way, we don't recommend tax arrears as a financing strategy!)

Your company is using the program for all the right reasons, i.e. improving products and services, staying competitive, etc. But many firms either haven't heard of or lose sight of the fact that the SRED tax credits can be even more 'accessible ' if you will, when you borrow or finance your claim.

Turning your SREd tax credits into valuable cash flow and working capital moves you one step ahead of your competitors we have always maintained to clients. Why. It's simply the old finance adage that a dollar today is worth more than a dollar tomorrow, as it can be re invested in your operations for a variety of reasons.

A typical question we get from clients considering the financing of a SRED claim is ' what are we allowed to use the funds for?'. And of coruse they love the answer, which is simply for any general company purpose you choose - typically that becomes reduction of working capital, clearing up or lowering payables, and just general day to day operations.

Financing your SRED claims in essence ' invigorates your working capital.

So who finances these claims and how would be describe the process. Is it complicated; easy, how long does it take? Those are the typical client questions in consideration of SRED finance.

We can make a broad pretty safe statement that banks in Canada don't finance sr&Ed claims for your tax credits. If they do, it is in conjunction with other security and arrangements you have with your bank. Most firms we talk to either have approached their bank, been declined, or simply have not been aware that sr Ed credits can be financeable.

We recommend you speak to a trusted, experienced and credible Canadian business financing advisor who is knowledgable in the area of SRED tax credit finance. That will shorten your process, maximize the amount you can receive under you claim, and in almost all cases simply reduce the time and effort you might normally expend to investigate SRED financing.

The reality is that a SRED finance expert can usually originate a full financing of your claim in a manner of a couple weeks, allowing for simple basics such as an application, review of your actual SRED technical filing, etc.

So, can you borrow against SRED claims? The answer is of course yes. Should you? That's your decision, but if you need cash flow and working capital today from a non repayable government tax credit that you certainly know what to do now. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your tax credit financing needs,


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 100 Million $ of financing for Canadian corporations


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 '





ABOUT THE AUTHOR

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.





Article Source: http://EzineArticles.com/5910297

No ‘ SRED ‘ Of Doubt ! SR And ED Tax Credits Finance Via A Bridge Loan Is Still Here !

SR&ED Finance – Alive And Well


Information on sred bridge loan finance in Canada . Despite recent changes to the program your s red ( sr & ed ) tax credits are still eligible for financing .



SR & ED Tax credits. Did you or your firm have any doubt about the SRED program in Canada? I think we can safely say thousands did, and the good news is that the SRED Program is still intact... yes some changes, but still alive and well .

And even better news? Your SR ED claim is still 100% financeable with the same criteria that have always been in place.

Let’s step back a bit. Naturally the thousands of business owners in Canada who receive a total of Billions, yes that Billions with our capital ' B ' were concerned about what many felt was the best research tax credit scheme ever, the Scientific Research and Experimental Development ( hence ' SR & ED ' ) program .

Criticism and hope abounded from every direction. The government wanted to ensure that funds spent were getting Canada an appropriate return on investment - which seems like a reasonable request for us taxpayer type folks. At the same time thousands of firms used the refundable tax credit as valuable cash flow and working capital to both survive, grow or start their business, and to be able to invest even further in next years r&d.

Many felt the program was too complicated. We're not lawyers, accountants, or government mandarins, so there’s certain issues we won’t weigh in on, and that’s one of them!

The reality is though that close to 4 Billion dollars was being doled out every year to almost 25 thousand firms in Canada, which was a huge portion of the government R&D subsidy. And it was all about return on investment as we said;

Who in fact is benefiting?
How are they benefiting? Etc!

A major report that was widely anticipated concluded that a reduction of the program was appropriate and needed, and that the better choice was for strategic financing initiatives that would bring a better ROI.

Anyway, its over, if in fact the federal budget that was table will be ratified by the government. So yes, there will be changes in how your expenses are computed, and in some cases they will be reduced. Capital expenditures, which were often a large part of the calculation seems to have been eliminated... again futher reducing your total refund.

Certainly the onus is on the industry's private SRED Consultants to prepare higher quality claims and in some cases address their fee structures from a viewpoint of optics.

Anyway, that’s the news from the top! But down here at the bottom, where we toil in the real world sred (sr & Ed) tax credits are still financeable via a bridge loan for the finance of the credit.

The criteria are still the same. Your SR ED claim is generally financed at 70% loan to value... the transaction is structured as a bridge loan with no monthly amortized payments. You receive the balance of your claim, i.e. the other 30% when the claim is audited/approved, less financing costs.

Basic back up info is still required, i.e. a copy of your claim, confirmation of your firms arrears or non arrears to CRA, and your financials. It's as easy as that.

Did you have that ‘ SRED OF DOUBT ‘ ? ! The dust has settled, and if you want to finance your claims via the SR & ED bridge loan speak to a trusted, credible and experienced Canadian busines financing advisor today.







Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 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 re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/sred_sr_ed_tax_credits_bridge_loan_finance.html