How can Physicians, Dentists, Surgeons and other dental and medical specialists Benefit from SR&ED?
As Chartered Professional Accountants in Toronto in Mississauga we work with doctors who are capable of claiming and receiving significant amounts of refunds through the SR&ED tax credit program. However, as the SR&ED tax credit program is reserved for scientific research purposes only, the process of being qualified for the credit for Physicians, Dentists, Surgeons and other medical or dental specialist may tend to become complicated.
First off, it must be known that SR&ED tax credits have several financial benefits for the doctors, dentists, surgeons and other medical or dental specialists. The financial benefits could be reaped from the SR&ED tax credit program, if the applying physicians or dentists have performed clinically based research. Moreover, Accountants of Toronto state that the qualifications for this credit are very rigid, therefore, time spent being claimed for the credit cannot, by any exception, be outside of research purposes. Also, it is stated by Toronto Accountants, that in order for the Physicians to benefit from the SR&ED tax credit program, their clinical fees must be going directly into the Medical Professional Corporation (MPC).
For SR&ED tax credit application methods, the application process requires the filling out of the same forms as other technology developers or manufacturing entities. However, Toronto Accountants state that the process for physicians to claim the credit could get more complicated than regular technology development companies, as the Medical Professional Corporations generally have levels of contracts and duties of disbursements, whereas regular tech companies only have regular employees.
One of the challenges that may exist for Physicians, Dentists, Surgeons or other medical and dental specialists in the case of documenting for receiving SR&ED claims, is that Doctors could be involved with several forms of institutions, such as Universities, Hospitals, or regional bodies. Accountants of Toronto state that such an involvement of the Physicians with other branches of institutions could potentially cause an overlap in claims or a ‘double-dip’, which would make it difficult to have clean claims for the Medical Professional Corporation.
The concept of documentation for the SR&ED claim can also become complicated, which could make the entire process of claiming for the credit complicated. It is known that Government Programs required rigid documentation for filing purposes. Moreover, the Toronto Accountants state that the CRA has a specific definition for scientific research, and also has very specific documentation requirements for the definition. Nonetheless the documentation requirements for Medical Professional Corporations are constantly being re-evaluated and are being re-assessed.
Toronto Accountants also suggest that setting a strategy, and a road map could be greatly beneficial for the purpose of optimizing dollar value perceived in tax credits for the company. As the SR&ED tax rebates can be great, harmonizing them with the other strategies in mind could potentially give enhanced benefits through the program. Toronto Accountants state that when planning for the application for SR&ED tax credits, Physicians, Dentists, Surgeons and other medical and dental specialists must keep in mind while applying, their individual after-tax positions, cash-flow, retirement, as well as any real-estate planning.
Although the end-result of filing for SR&ED tax credit claims could be financially beneficial for the Medical Professional Corporation you must use a company who specialise in this area. SRJ Chartered Accountants who have offices in Mississauga and Toronto have assisted a large number of clients in various industries obtain successful refunds for their SR&ED claims. We also work virtually with our clients from all over Canada and globally. Our tax consulting and SR&ED partners assist Physicians, Dentists, Periodontists, Endodontists, Surgeons and other health-care specialists to prepare and file SR&ED claims. If you are interested in determining your eligibility to file a SR&ED claim please contact us directly by email (firstname.lastname@example.org) or by calling our office (647-725-2537).