Telos Business SolutionsScientific Research & Experimental Development Consultants
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Unpacking the New T661
Unpacking the New T661
“I’ve heard that the Canada Revenue Agency has revised the T661, the main form used to file SR&ED claims.”
“Will these changes benefit me with regards to the administrative effort I put into R&D?”
“The format of the new form looks more compact. Is it easier to fill out?”
You may have many questions about the new T661 and your relationship with Telos Business Solutions. We would like to try to address those questions and provide our perspective on the new format, its perceived ease of use and what this means for you the client and Telos the consultant.
Changes were made to the T661 form in order to simplify the SR&ED filing process and limit the scope of the audit process. A condensed format with schedules embedded into the form allows for only very specific technical information within strict word limitations. For the CRA reviewer, understanding the project and being able to identify additional materials needed may have become easier if the form is filled out correctly. By developing a series of fields, check boxes, and questions throughout the form, and by making a distinction between experimental development and scientific research, the CRA has attempted to make the process of determining eligibility much faster. The claim review process is planned to be expedited (the CRA hopes to have a 120-day turnaround) and SR&ED claims can now be bar-coded along with the rest of your T2 return. In the near future, Internet-based submission of T661 forms will enabled, even further accelerating the evaluation.
It would appear, however, that the CRA’s changes have also enhanced the requirement for proper and vigorous documentation of your R&D efforts. Evidentiary support such as timesheets, data logs, photographs, videos and various financial reports are all the more crucial to the success of your claim. The CRA may ask for these documents at a later date, so it is important to preserve data from all of your R&D activity. Write in a journal each time you take a few hours to work on R&D. Have employees specify R&D hours when filling out timesheets. Reserve a separate drawer exclusively for R&D receipts and records. Every little detail helps enormously.
“So if I can get organized, I could probably fire off this new and improved T661 form myself in a few hours, right?”
Unlike prior revisions to the SR&ED reporting structure, constraints have also been placed on the content of each response. If a claimant does not answer the questions satisfactorily within the constraints, the project and/or claim will be denied. Furthermore, the scope of each SR&ED project is narrower by necessity of the imposed limitations, and all projects (rather than just the largest ones) must now be claimed. Compliance with these new rules is still challenging and time-consuming, especially when trying to undertake these tasks yourself while trying to run your business and innovate further. Telos will work with you to make clearer distinctions between your projects for the purpose of the new reporting methods. With the strict demands of the new form, an experienced consultant will be of great benefit to reduce the effort required to file your claim. The new format can be deceiving. It is actually more challenging to position a project given the new constraints. Without the ability to free-flow in explanation, the workload is increased.
However, our ever-improving claim management process will save you some time and effort. Telos has invested in thousands of dollars of corporate income tax preparation software, ensuring that we have the same software packages as the accountants with whom our clients work. Consequently, we are able to work more closely and quickly with your accountant, as your T661 and other financial documents can be transferred electronically in one file. Telos can assist with organizational systems to help identify what you need in order to have a successful claim. We exist to support you, and if you are prepared to perform and document your R&D, we are prepared to distinguish and describe your projects so that you receive the maximum credit due to you.
To view the new T661 form, click here.
To view the Guide to the Form T661, click here. In Your Pocket
Have you filed an SR&ED claim with Telos Business Solutions and are anxiously awaiting your money? We can help. Telos has built agreements with two respected financing institutions that will provide you with your R&D reward before government funding becomes available. We understand that a continued cash flow is needed to run a business. For more information, please contact one of our representatives. Under Construction
Telos Business Solutions is undergoing construction! Our website, print materials and office are being polished and revamped. Encourage fellow business owners engaged in R&D to check us out! As we press on with our office renovations, keep an eye out for our open house happening soon! Telos on the Town
Telos is a member of the Thunder Bay Chamber of Commerce and Telos President Justin Frape is a Vice Chair on the Board of Directors. We're Looking!
Telos Business Solutions is seeking to hire technical and/or financial analysts with the ability to communicate effectively and a desire to further their knowledge and skills. For example, a technical analyst may be hired due to their scientific background and will be given the knowledge and tools to complete financial analyses, eventually working in the capacity of an SR&ED consultant.
For more information, please contact us. | |||
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