Tax Credit Loans For SR&ED Credits In Canada: Finding Your Way In SR ED Financing

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What Seems To Be The Problem Here? SR&ED Tax Credit Financing Explained – Finally!

SR&ED Debt Finance Loans In  Canada for SR&ED Tax Credits - Canada's R &D refundable credit system seems to pose challenges for some clients looking to monetize, via SR ED financing, their SR ED claims. Does there have to be a problem? We don't think so. Let’s dig in.

  

UNDERSTANDING THE GOVERNMENT OF CANADA'S SR&ED PROGRAM   

Of course, SR&ED credits are available via the governments ' Scientific Research and Experimental Development Tax Credit program.  Although federal budgets in recent years have changed the program significantly from the viewpoint of streamlining the process, certain portions of the allowable refund were also cut back, i.e. capital expenditures relating to the actual R&D capital investments your company makes.

  

IS A SR&ED LOAN REALLY DEBT FINANCE?  

The term debt finance is really a misnomer, as no debt comes on the balance sheet when you monetize your sr ed claim via 7 Park Avenue Financial  - in effect you are financing an account receivable, with your client being the federal and provincial government - that receivable is turned into cash loan proceeds.

 

The irony of SR&ED is that many, in fact almost all banks don't recognize sr&ed receivables - they view your claim as an ' intangible asset ' in many cases which is partially understandable but certainly less so if your firm regularly files claims.

WHO PREPARES  SRED CLAIMS?

In Canada, the majority of tax credits/claims are prepared by independent consultants - they are known as ' sr&ed consultants'.These sr ed claims are filed, of course, in conjunction with your year-end tax return.   Retaining a good preparer for your claim is one part of the financing process of a claim. In the past couple of years, a lot of focus was placed on the way consultants bill and prepare claims - the majority of which are on a ' contingency' basis, which in hindsight probably caused some bad behaviour by a small few.

WATCH YOUR DEADLINES!

We encourage all clients to consider whether they are eligible for the SR&ED  refundable tax credit and focus on filing the claim promptly as there are some deadlines in place under the program.

 

BILLIONS OF DOLLARS ARE REFUNDED TO CANADIAN BUSINESS ANNUALLY UNDER SRED

 

Refundable credits return billions of dollars to Canadian corporations each year.  Your ability to cash flow or monetize your claim makes the program complete in some way. Your company is in effect ' fast-tracking ' the cash flow return to your company by filing and financing your claim.

  

HOW DOES A SR&ED BRIDGE LOAN WORK?  

How then are the claims financed? It certainly doesn't have to be problematic if you have some expertise backing the process.  A simple business application starts the whole process - typical info needed here is a copy of your claim, information on who prepared it, as well as your business financials.

 

WHAT IS THE COLLATERAL REQUIRED FOR A SR&ED BRIDGE LOAN?  SPOILER ALERT - IT'S  YOUR SR&ED CLAIM!

We note here that many firms that complete claims range from start-ups to firms that are still in the early stages of revenue. So it's important to understand that the key collateral under SR&ED financing is fact, just the claim itself. In effect, you've created a (government) account receivable and are only financing /monetizing that specific A/R.

  

CONSIDER A SR&ED CREDIT LINE TO PRE-FUND YOUR CLAIM  

The newest trend in tax loans for SR&ED financing is the ability of your business to, in effect, pre-finance your claim - you are reimbursed for funds you are spending during your spend. That fast tracks the return of R&D capital even faster.

  

CONCLUSION  

Does your firm qualify for sr&ed finance? If your firm makes investments in research and development and if you're looking to avoid any ' problems ' associated with financing SRED CREDITS, seek out and speak to a trusted, credible and experienced Canadian business financing advisor at 7 Park Avenue Financial and let us help. Our specialty is helping you fund refundable tax credits -  The probable result - Problems gone!

7 Park Avenue Financial provides value-added financing consultation for small and medium-sized businesses in the areas of cash flow, working capital, and debt financing.



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.

' 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. He is an experienced

business financing consultant

.

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 financing 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.


Click here for the business finance track record of 7 Park Avenue Financial



Stan Prokop
7 Park Avenue Financial/Copyright/2021

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YOUR COMPANY IS LOOKING FOR  SRED FINANCE!



You've arrived at the right address! Welcome to 7 Park Avenue Financial



        Financing & Cash flow are the  biggest issues facing business today



                              ARE YOU UNAWARE OR   DISSATISFIED WITH YOUR CURRENT  BUSINESS FINANCING OPTIONS?



CALL NOW - DIRECT LINE - 416 319 5769 - Let's talk or arrange a meeting to discuss your needs



EMAIL - sprokop@7parkavenuefinancial.com

A SRED financing tax credit loan is a great example of the good news around Canada's SR&ED program. If there's any 'bad news' it’s around the fact that once again some industry pundits are again wondering about the true benefit to Canada under its current ‘Scientific Research & Experimental Development' (aka 'SR&ED'!) program. SRED CANADA is Canada's premier refundable tax credit.

WHAT IS SR&ED

Canada's non-refundable tax credit program involving your investment in r&d capital is called the SR&ED program. Most business folks refer to it as 'SRED' and the government term is actually SR&ED (Scientific Research and Experimental Development) Program. It provides financing support to Canadian firms such as yours who invest in new processed and technologies to advance business and science.

Canadian provinces also partner on the program, providing additional assistance. SR&ED (Scientific Research and Experimental Development) Program is the flagship investment incentive program created by the Canadian government via tax credits.

It provides financial support to Canadian companies that are involved in creating new or improving existing technologies, with the aim of stimulating scientific advancement in the country. Most provinces have their own programs to encourage scientific R&D, which provides supplemental assistance to SR&ED claimants.

As one of the best of its kind in the world, many countries have followed Canada’s lead in setting up similar programs. It also makes it even more important to realize the quick and efficient cash recapture of your R&D capital investment via the help of an SR&ED finance consultant. Let's dig in.

While thousands of firms are still aggressively planning to file claims via their SR&ED consultant for their non-repayable tax credit refund, just as many might be wondering if financing that claim is still valid and accessible. The answer - a resounding yes!

While some business owners might view the program as a bit of ' danger and complexity ' that's definitely not the SRED loan process - which is, to put it simply - easy! We're the first to admit that properly preparing and submitting a claim is not for newbie and the weak of heart. Never has been your ability to prepare a proper claim, with proper assistance more important. The 1400 words and 3 questions you are required to address have never seemed more important.

Statistics in recent years show that over 20,000 claims annually, if not more are filed by firms just like yours. And as a note from our view in the trenches, all of those firms still view that tax credit claim as a key, if not a major source of financing for their firm. It's the private companies in the SME ( small to medium enterprise ) sector that file the majority of those claims. For more info on the dollars invested by the government in SRED click here.

That cash flow, when received allows them to do a number of things, including furthering additional R&D, starting or furthering revenue and marketing, and by virtue of that SR&ED work maintaining their particular dominance in their niche. The program has been around for over 30 years now and understanding the rules and the 'culture' around SR&ED is important.

Again, we'll leave that to the experts, pundits, and oh my god the politicians to assess the benefits and historical culture/perspective around SR&ED - We'll focus instead on the monetizing of those claims into real cash flow and working capital.

WHY SR&ED FINANCING VIA A SR&ED LOAN

If your company has address technological challenges and invested in R&D and has filed a SRED claim you are eligible for SR&ED funding. Your SRED financing can take one of two forms in Canada.

You can cash flow your claim anytime immediately after you file it, or alternatively (with a bit of a track record behind you) you can finance your claim on an accrual basis. The accrual concept is becoming increasingly popular as it simply fast tracks cash flow re your R&D capital spend.

In essence, you're recovering a portion of your R&D as you spend on it. That's a solid business premise as most Canadian business owners and financial managers would agree. SRED finance is agnostic to who prepares your claim, if, and it's a pretty basic if, your claim is prepared by a bona fide SR&ED consultant with some level of credentials and expertise. As the majority of SRED consultants seem to work on contingency naturally they are in some ways more at risk than your firm, so it's quite easy via references to find a suitable party to submit your claim.

It's these consultants that address key issues such as technical policies, claim eligibility, expenditures qualifying, etc. Looking for something simpler in the whole SR&ED process? The actual financing of your tax credit! Simple, as we stated. We explain to clients that they should view the process as a standard business application that is secured by the tax credit claim itself.

 

 

HOW DOES SRED FINANCING AND THE ' SR&ED ' LOAN R&D TAX CREDIT WORK? 

Other key aspects of SRED financing? The basics are as follows: 70% loan to value funding for your filed claim. Typically no payments are made during the duration of the loan, and final adjustments are made at government finalization, returning to your firm the balance of 30% less financing costs. Accrual financing for your tax credit claim might be funded at a lower loan to value.

 SR&ED Eligibility - Does your Canadian company qualify for an SR&ED claim? 

KEY FACTS ABOUT THE SR&ED PROGRAM

1. Almost any company can participate in the program - Scientific, medical, technological industries all participate. As long as your work is under eligibility criteria you will be allowed a claim and refund.
2. The program is all about advancing scientific and business knowledge and improving on those processes and products we mentioned previously
3. Many businesses are surprised to hear that the research you do does not ultimately have to be successful ( hopefully it will be ) so success is not part of your refund eligibility
4. Companies, with the help of their SRED CONSULTANT, have to only show their work in enhancing current knowledge levels and how they undertook to face technological challenges
5. At 7 Park Avenue Financial, we work with many firms that file year after year, as well as first-time applicants. Even firms that have filed unsuccessfully in the past can file.

CONCLUSION - SRED FUNDING

Your company should consider the SRED program and financing your claim if you want your firms share of the Billions of dollars that the government pays out annually. In fact, well over 20,000 companies in Canada participate in the program every year! At 7 Park Avenue Financial, we tell clients that the SR&ED program, along with the GOVERNMENT OF CANADA SMALL BUSINESS LOAN program are two of the best government-related programs in business.

The Canada  Government guaranteed loan program is often called the 'SBL LOAN' while SR&ED refers to sr&ed refundable tax credits that can be also financed to accelerate cash flow.

Speak to a trusted, credible, and experienced Canadian business financing advisor and sr ed finance consultant who can assist you with your tax credit finance loan today. Think of that person as part of your total SR&ED process!  Talk to us about Sred financing tax credit sr ed finance consultant implications for your firm.

Click here for the business finance track record of 7 Park Avenue Financial



Stan Prokop 7 Park Avenue Financial/Copyright/2020

SR&ED FINANCING TAX CREDIT LOAN VIA A SRED FINANCE CONSULTANT

SR&ED Tax Credit Loan Financing

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SR&ED financing is simply the method by which you can, at your own firms own option, monetize or ‘cash flow ‘ you Sr&Ed tax credit and generate needed working capital and cash flow for ongoing operations or of course further investment in your r&d capital processes and development. All Canadian privately owned companies in every industry are eligible under the program.



The ' SRED ' program is one of the best, yet somewhat underutilized ways of recovering research and development expenditures. When both the federal and provincial tax credits under the program are combined they can return up to 50% of your r&d spend.



We have all seen the oil change commercial where the mechanic states ‘you can pay me now or pay me later ‘. Well financing your sred claim has a similar ring to it – of course you have the option of waiting for the government at the federal and provincial levels to mail your firm your cheque – that could take anywhere from 1-12 months – Or you can arrange to finance that claim now and utilize those funds for any business purpose.

Are we eligible to finance our sr&Ed claim? Clients often ask. We can only replay that if you have a claim, and have filed it, you are in fact eligible. In fact, under certain circumstances it can be arranged to receive funds even prior to filing.



That's what we at 7 Park Avenue call a financial incentive! Spending items covered in your refund includes items such as salaries, work done by subcontractors on your project, and items purchased relevant to your specific project. Your claim is filed with your T1 tax return in conjunction with your accountant and SR&ED Consultant.





Clearly the purely financial benefits of the sred grant program in Canada are numerous – you receive significant amounts back from expenditures made on research, including wages and salaries associated with that research, as well as major portions of material and equipment expenses.

All of those above noted expenses are ‘cash out ‘to your firm – the funds have been spent. So why not consider financing your claim and receiving those funds back in an extremely timely manner.

We can almost hear some of your questions now as you review our information, as they are typical of what many clients ask:

How exactly do I monetize the sred claim

What exactly is a sred loan – is there additional debt involved

How long does it take and what does it cost?



Let’s cover off some of those very basic questions so you can feel comfortable about the sred financing process. The sred financing, or the monetization or cash flowing of you sred claim is simply a business financing that uses the actual sred claim as collateral. You receive approximately 70% of the full federal and provincial total as a short term cash loan that is collateralized by the sred itself. Of course the additional 30% is still yours, it is simply held back as a buffer for any adjustments that are made to your claim.

No payments are made on your sred loan, and the final cheque to your firm (you have already received 70%) is the holdback amount less the financing costs. So you have pure cash flow and additional working capital, no long term debt associated with a loan per se, and no payments are made. That is truly creative business financing for which most Canadian business owners are not even aware.

The typical process to create a sr&ed financing is approximately 2-3 weeks, you should quite frankly view it as any other business application – the usual business info and backup on your firm, plus of course the details of the sred financing.



From the government's perspective the amount of time it takes to validate your claim or inquire about any specific details might be from 2-6 months depending on the size of your claim. Your actual Sr ed credit is the main collateral for the loan; Canadian firms are tired of waiting for their refund, so they explore the refundable tax credit financing option. This short term working capital loan is a key source of cash for many younger and growing companies, with many in still in 'start-up' mode. They can't wait for long periods of time to recover expenditures related to future sales prospects - SRED finance loans allow the firm to grow faster.



In summary, have your claim prepared by a qualified sred consultant - recent submission rules and styles have changed.

If you have unlimited cash flow and working capital resources by all means wait for your cheque – if you want to cash flow or discount your claim speak to a credible, experienced and trusted business financing advisor in the area of SRED Financing.





7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com

Click Here For 7 PARK AVENUE FINANCIAL website !



7 Park Avenue Financial provides value-added financing consultation for small and medium-sized businesses in the areas of cash flow, working capital, and debt financing.



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.

' 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. He is an experienced

business financing consultant

.

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 financing 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













Working Capital Via SRED Finance

A Working Capital Breakthrough – Financing Your SR ED tax credit claims ( SR&ED ) makes Sense!

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How and Why to Finance research and development tax credits

Information on financing sr&ed tax credit claims in Canada, Financing your investment in r&d capital is a solid working capital and cash flow solution

There is generally a limited number of ways to finance your company and generate working capital. Yet one of these ways is somewhat unknown to many Canadian firms who do any type of research and development under the SR ED tax credit program. And it is a pretty simple decision - finance your tax credit as soon as you have filed it!



Cash is flowing out of Canada's sr&Ed program - why not let it flow towards your company. Without a doubt this is the largest incentive for Canadian firms to fund research, because under the program you of course recover a significant portion of all you have spent, at the same time enhancing your firm’s competitiveness in its products and services.



So hopefully we have articulated to a certain degree the benefits of filing a sred claim... so how do we finance it. The answer is simply to contact a sred tax credit Canadian business financing advisor. The elements of a successful sred financing are quite simple: have your claim prepared by a sred consultant that has proper experience in your area or industry. As soon as the claim is prepared it is filed by your firm and your accountants, and you apply for a refund at the same time you file your financial statements.






Discussions with clients around sr ed , aka sr&ed research development tax credits focuses typically around two area, the actual benefits they attain from their r&d, and, as importantly the financial impact the sred cash has on their balance sheets and working capital .



So who is the sr&Ed candidate from a viewpoint of both maximizing the program, while at the same time benefiting from financing the claim? In a world, everyone, as long as you are filing. However if we had to profile the typical firm that both files and finances their sr&ed calim via a sred loan it would be a company that typically is in the technology industry and is in its early cycle of development, revenue, etc . But, that having been said many mature manufacturing or ' old economy ' type firms have been filing successfully for many years and reaping those same benefits.



So how does SRED translate into working capital in an innovative manner? It’s in the financing, or we can call it the ' monetizing ' of your claim. Think of it frankly as financing or monetizing any one of your receivables, in the same manner that you do with your bank or an independent finance firm. You are in effect ' discounting ' that receivable today to receive the benefits of cash flow and working capital now. Of your you can go to the mail box every day for the next 3-12 months and see if your sred cheque was ' in the mail ' , but why not one up your competition and finance your claim for that working capital breakthrough we are talking about it .



Think of the positive dynamics around that - you have accelerated R&D competitiveness, you have been reimbursed for those expenses under the sred program, and now you're taking that money that is non repayable - yes non repayable! And financing that claim to fund the on going growth and profits of your company.



Financing of the claim involves a very standard business application, with the focus of the sred as your collateral. You're not taking on extra debt remember, you are just monetizing your claim for cash flow.



The sred loan is a bridge type loan , and is liquidated against the final cheque from the government re your refund. In the meantime you have working capital to reduce payables, fund ongoing R&D again, or simply for any general corporate purpose. The whole process can usually be accomplished in a couple weeks. We're guessing it’s taken you that long sometimes to finance your new photocopier!



Speak to a trusted, credible and experienced business financing advisor on the benefits of cash flowing your sr&Ed claim for working capital now.

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

Click here for 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 .

' 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.

Stan Prokop

SRED Financing - SR&ED Finance Loans in Canada

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SRED Financing is your firm's ability to take immediate cash flow and working capital advantage of our SR&ED tax credit claim. This program, (formal name = Scientific Research and Experimental Development) is bar none the best tax incentive program in Canada. Other than being taxable as income the refund you receive from the government is a non repayable grant. What could be better than that?

The irony in this great program is simply that almost 70% of companies in Canada that are eligible for the program do not even apply, let alone receive their funds! It clearly is a source of untapped cash flow and working capital for your Canadian business that should be maximized to the hilt.

The other 30% of Canadian firms who use the program utilize it around their efforts to develop new products and services, building prototypes, and solving technological challenges.

So your Canadian controlled private company utilizes and files SRED filings. Did you know your claim can be financing immediately after you file it, literally the same day. Specialists that work as 'SR&ED consultants are experts in preparing your claim and in Canada your SRED claim can be prepared at your cost - and you keep all the proceeds of the government grant, or alternatively, your claim can be done on a contingency basis, at no cost to yourself, and the consultant usually keeps anywhere from 10-30% of the total refund received.

However most Canadian business owners and their SRED consultants do not know that your claim can be financing, either during the preparation of your claim, (yes, before your file, if you qualify!) or immediately on filing of your claim.

Generally with this type of financing you receive immediately approximately 70% of the value of your claim. The other 30% still comes back you of course, but its simply a bit of a buffer to cover financing costs and any risk that a portion of the claim will be disallowed or clawed back.

When we think in terms of specialty financing we can categorically state that SRED financing is specialty financing in Canada. We urge clients to locate a business financing advisor who has credibility, experience and background in this area.

The SRED financing process is not as complicated as you seem if you are well prepared and have access to good assistance. Its as simply as completing a basic business financing application, ensuring proper back up is in place and valid. That includes info on your company, the SRED claim itself, your previous SRED claims if you have filed previously etc.

The reality is that SRED financing can be completed within 2-3 weeks of starting the process. The beauty of this type of financing is that no payments are made on the SRED loan. In effect you can say that you have factored or discounted the SRED claim. You are simply waiting for your cheque from Ottawa, and are making use of the working capital and cash flow now. That's a solid interim financing strategy for many firms, and that cash can be used for reduction of payables, investments in new equipment, additional staff, etc. The bottom line = any general worthwhile corporate purpose.

In summary, of course ensure you are taking advantage of Canada's Sr&Ed program. Once that is the case you have the option of financing your claim, allowing you to maximize the true benefits of the program, i.e. the recovery of your R&D expenses in the most time efficient manner possible. That's a solid financial strategy.

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

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 .

' 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.

Stan Prokop


















Article Source: http://EzineArticles.com/expert/Stan_Prokop/432698


Article Source: http://EzineArticles.com/4303816

How Can My Canadian Company Get a SR & ED Tax Credit Loan - Can SR ED's Be Financed?

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Not all Canadian business owners and financial managers are aware of one of the greatest government programs still currently in existence at both the federal and provincial level. The formal name for the program is Scientific Research and Experimental Development program. Most people call it simply the SRED (SR &ED) program; we have also heard many people pronounce it as 'SHRED 'also!

We put Canadian businesses into two categories when we discuss the program - those that don't know about the program period, and those that know about the program but are not aware that their claims can be financed.

SR ED financing is an excellent source of short term cash flow, and allows a company to reap the benefits, in cash of funds that they have put into R&D.

It is probably useful to do a short overview - let's call it a SR ED primer!

The program is administered at the federal and provincial levels of the Canadian government. It is very important to note that the SR ED grant (yes it's non-repayable) is for Canadian private firms only - it does not apply to public corporations the program is applicable literally to almost every type of firm and industry in Canada. A company files it's claim at the same time it files it's year end tax return.

In our experience the majority, we feel almost 95%+ of claims are prepared by an independent third party. They have expertise, credibility, and have a strong knowledge of the program and the government requirements. We would further point out that if a claim is not prepared by a qualified third party then there may be an issue in financing the claim - not always, but sometimes.

Claims can be expensive to process and prepare, and in general the industry has evolved into two types of costs associated with the claim. What are those two cost scenarios?

1. Customer pays a third party in full for time and preparation involved in the claim. The customer reaps the full benefits of the claim when it is processed

2. Customer signs an agreement on a contingency basis, and pays the preparer of the SR ED a portion of the claim when it is approved - bottom line he has no cash outlay and the SR ED consultant is at risk re time and preparation involved in the claim.

Let's now focus on financing of the claim. The financing of the claim is somewhat of a boutique industry in Canada, and requires specialized knowledge around the quality and collateralization of the claim. The Canadian banks, as a rule, with only minor exceptions, do not make SR ED loans.

Claims are financed at approximated 70% of loan to value. What do we mean by that? We mean that loans on SR ED are made to 70% of their combined federal and provincial amount. Example - Customer files a claim for $ 300.000.00. The SR ED loan would be for 70% of that amount: = $210,000.00.

Claims can be financed relatively quickly when working with a qualified financing expert in this area. It certainly is possible to complete a transaction in a couple of weeks, from initial discussions.

Naturally some level of due diligence is required on the firm, and we point out that many firms are in fact total start ups and are filing their claim for the first time. An additional financing note is that first time claims are scrutinized more closely as the customer at that point does not have a track record in this area. Track records help the financing.

In a future article we will discuss further relevant aspects of SR ED financing. Our key take away points here are that the SR ED program is a very viable program and source of cash for Canadian business. Claims can be financed, and are a valuable source of working capital for many Canadian firms.

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

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 .

' 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.

Stan Prokop
















Article Source: http://EzineArticles.com/expert/Stan_Prokop/432698


Article Source: http://EzineArticles.com/3726771

SR and ED Or SRED - Call It What You Want But Take Advantage of SRED Funding Or Factoring!

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Semantics we tell clients. You can call it you SRED claim, your Shred claim ( they use that a lot also! ) or your SR and ED claim. You can even throw in an ampersand and correctly write it as SR&ED.

But there is only one bottom line, which is, why you aren't considering financing your claim. Putting our semantics aside many business owners and financial managers are inquiring as to the financeability of their claim. More often that not they have been told by their bank that this type of claim is not financeable, and even though you are showing it on your books as a receivable it cannot be margined for working capital and cash flow.

Two words. They are wrong, as Sr Ed claims can be financed in a large number of situations. They are financed utilizing Sr Ed Canadian business financing advisors who are experienced in this niche area of Canadian finance.

We believe it's always good to recap the basic and set the stage for our financing discussion. The program is of course a federal program, in concert with the provinces, that encourages small, medium, and dare we say it, large corporations to conduct research on products, process, etc.

How committed is the government to this program ask clients? Very we say, given that approximately 4 Billion dollars are doled out each year to the 1/3 of the companies that take advantage of the program. That of course infers that 2/3 of eligible customers in fact don't use the program. We have heard a litany of reasons around why they don't from clients - they include: we're too busy, its sounds complicated, we don't want to get audited, our r&d spending is not large enough, etc. These firms would simply be better off keeping it simple and saying, ' No we don't want funds that are non repayable that re -imburse us for our r&d', because that's in effect what they are saying.

If you have a valid claim prepared by either an experienced internal party, but more preferably a true SRED consultant then you can finance your claim. Funds for approximately 70% of the claim value are provided to your firm with the collateral of course being the SR ED receivable. Of course you can wait for 3, 6, or 12 months to receive your funds, but why not consider putting that valuable cash flow and working capital back to work in your business.

Clients who finance Sr &ed claims typically use the funds for general working capital purposes, further r&d, new equipment, marketing, etc. The bottom line is that you choose the use of the funds. And by the way, that other 30% of your claim is still yours of course, it's returned to your firm, less financing costs, when the government sends your cheque. And get the news get any better, but no payments are made on the SR Ed loan, interest simply accrues and is calculated at the end of the financing.

Don't fail to consider SR&ED financing as a way to stay one step ahead of the competition and satisfy your cash flow and working capital needs at the same time. Speak to a trusted, credible and experienced SRED Canadian business financing advisor to assist you with the factoring of your claim.

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

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 .

' 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.

Stan Prokop





















Article Source: http://EzineArticles.com/expert/Stan_Prokop/432698


Article Source: http://EzineArticles.com/5297123

SR&ED Financing In Canada : Accessing SR ED Loans

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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!

You have filed your SRED (SR&ED) tax credit . The benefits of this program can’t be overstated . Now all you have to do is wait for the cheque from the government, right ? Let’s dig in .

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 .

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

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 .

' 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.

Stan Prokop