Tax Alert from Ernst & Young – February 19, 2007
The business community should be pleased to know that at the January 25, 2007, Association de planification feiscale et financiere (APFF) Scientific Research and Development (SR&ED) Tax Conference, the Canada Revenue Agency (CRA) reversed its previous position that payments made to agencies who loan out their employees or subcontractors (staff loaned) were generall not eligible for SR&ED tax credits under the proxy method.
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This applies to companies that hire contractors from a firm or an agency.
The firm or agency must have a registered GST number, and the “loaned” contractors must still conduct their work within the geographical bounds of Canada, to qualify.
Thanks for pointing that out..