Tax credit for research, innovation and commercialization (CRIC)

The tax credit for research, innovation and commercialization (CRIC) is available to corporations that carry out scientific research and experimental development (R&D) activities or pre‑commercialization activities in a taxation year beginning after March 25, 2025.

To claim the CRIC, eligible corporations must fill out the prescribed form and attach it to their corporate income tax return. The form will be made available during the year 2025.

Corporations eligible for the CRIC

To benefit from this tax credit, a corporation must notably:

operate a business in Québec;
undertake in Québec eligible R&D or pre‑commercialization activities;
cause such activities to be undertaken on its behalf in Québec as part of a contract.

Scientific research and experimental development (R&D) activities eligible for the CRIC

R&D is a scientific investigation or search that is carried out in a field of science or technology by means of:

basic research: work undertaken for the advancement of scientific knowledge, with no practical application in view;
applied research: work undertaken for the advancement of scientific knowledge with a practical application in view;
experimental development: work undertaken for the purpose of achieving technological advancement, for one of the following purposes:

creating new materials, products, devices or processes,
improving existing ones (including incremental improvements).

Important: Québec legislation is harmonized with federal legislation as regards the definition of R&D. The Canada Revenue Agency carries out the scientific review of R&D work.

Pre‑commercialization activities eligible for the CRIC

Pre‑commercialization activities eligible for the CRIC are the following:

tests, technological validations and studies carried out to meet regulatory requirements and aimed at obtaining a registration or certification for the purpose of commercializing an innovation;
product design, including the development of form and aesthetics, improved functionality and choice of materials.

To be eligible for the CRIC, pre-commercialization activities must be undertaken in conjunction with R&D work carried out in Québec by the corporation or on its behalf.

Expenditures eligible for the CRIC

For the purposes of the CRIC, qualified expenditures must have been incurred by a corporation, or on its behalf, for R&D or pre-commercialization activities. They must have been incurred in Québec and relate to:

salaries or wages paid to the corporation’s employees;
50% of the amount paid to a subcontractor for a contract carried out in Québec;
50% of the payments made to an eligible public research centre, an eligible research consortium or an eligible university entity;
property acquisition costs. However, qualified capital expenditures do not include costs relating to the acquisition of a building, land or a right to use a building or land.

Rates of the CRIC

A corporation may benefit from a refundable tax credit at a rate of:

30% on a maximum of $1 million in qualified expenditures that exceed the amount of the applicable exclusion threshold;
20% on the excess of the sum of qualified expenditures over the $1 million maximum, as the case may be.

Exclusion threshold applicable to the CRIC

To benefit from the CRIC, a corporation must have incurred qualified expenditures in excess of a certain threshold in a particular taxation year, namely the greater of the following two amounts:

$50 000;
the sum of the basic personal amount of the applicable personal income tax system for each employee. This amount is adjusted to reflect the time spent by an employee on eligible R&D and pre-commercialization activities.

Rules for cumulating the CRIC with other assistance programs

The amount of any government or non-government assistance attributable to R&D or pre-commercialization expenditures must be subtracted from the amount of qualified expenditures, in accordance with the usual rules.

A corporation cannot benefit from both the CRIC and another tax credit provided for under the Québec tax system with regard to an expenditure. The corporation must choose one or the other.

For instance, property acquisition costs are not eligible for the CRIC if they arque also claimed for the tax credit for investment and innovation. Conversely, these costs cannot be eligible for the tax credit for investment and innovation if they are claimed as part of an application for the CRIC.

A corporation holding an initial qualification certificate for the purposes of the tax holiday relating to the carrying out of a large investment project cannot claim the CRIC for property used, or acquired to be used, as part of such a project.