What can qualify for a door and window manufacturer?
SR&ED does not reward a new model. It rewards a technical problem solved through experimentation. The Canada Revenue Agency (CRA) asks that the work pursue a scientific or technological advancement and rely on a systematic investigation, by experiment or analysis.
The starting point is technological uncertainty: it is unknown or uncertain that a result can be achieved, because of an insufficiency in the available knowledge. If a known method or component already solves your problem, there is no uncertainty.
Which situations deserve a closer look?
Here are situations where a manufacturer might run into technological uncertainty. They are examples to examine, not guarantees: everything depends on the facts of your project.
- Reaching a thermal or air-tightness performance that no known assembly achieves, by changing the frame material, structure or glazing.
- Solving a condensation, warping or seal durability problem at extreme temperatures, with no known solution.
- Integrating a new material (composite, recycled or bio-based) whose behaviour in a door or window frame is poorly understood.
- Designing a cutting, welding or assembly process that reaches tolerances known equipment cannot.
What generally does not qualify?
The CRA excludes, among other things, quality control and routine testing, commercial production, style changes, market research and the acquisition of knowledge that already exists.
For a door and window manufacturer, this often covers:
- New colours, finishes or models: these are style changes.
- Routine compliance or certification testing, which risks falling under quality control.
- Putting an already finished product into production, which is commercial production.
- Applying a method your supplier or a competitor already masters.
Support work counts too
The CRA recognizes that some support work can count when it directly supports the core work: engineering, design, computer programming, mathematical analysis, data collection or testing. A prototype, a test bench or a simulation built to resolve the uncertainty can therefore be part of the project.
How to document your trials
- State the problem in measurable terms: for example, an insulation value or an air leakage rate to reach, with the test conditions.
- Check what already exists first: suppliers, standards, technical literature. If the solution is known, it is not SR&ED.
- Run trials with measurements: each prototype, its results and what you concluded from them.
- Keep dated records while the work happens: the CRA says documents generated when the work was carried out are the most common. It also lists photographs, videos and samples.
What the credit can represent
For most Canadian-controlled private corporations, the enhanced investment tax credit is 35% of qualified expenditures, up to the expenditure limit, which rose from $3 million to $6 million for tax years beginning after December 15, 2024. Other entities receive 15%, as do expenditures above the limit. The limit can be reduced based on taxable capital. The credit depends on your qualifying expenditures and your situation: it is never guaranteed.
Claims are filed within 18 months after the end of the tax year. Since April 1, 2026, the CRA also offers an optional pre-claim approval, with a determination within eight weeks.
Having your project reviewed
If your team had to solve a technical problem whose answer did not exist at the start, a review is worth it, ideally before your year-end, while test results still exist. At Hubvention, we help you see whether your work qualifies and structure the file. Book my diagnostic →