SR&ED for medtech companies
SR&ED for medtech companies.
Medtech teams often do experimental development without ever calling it SR&ED. A claim picks out the technical problem, the tests your team ran to solve it and what the company paid for that work.
Filing deadline
A corporation generally has 18 months after its tax year-end to claim SR&ED for that year.
How do you spot the SR&ED in a product?
Look for the technical problem that forced the experiments. A new product can contain no SR&ED at all, and an ordinary-looking one can hide real technical work: getting a sensor accurate enough, making an assay reproducible, keeping a material biocompatible or getting software to run fast enough.
The test is whether skilled people in your field could have solved the problem with what was already known. If they couldn’t, and your team worked through it with prototypes, measurements and changes, that’s the work to claim. Prototypes that didn’t work count too, if they taught you something.
If it looks worth reviewing, the SR&ED calculator gives a rough federal and provincial estimate. It’s a starting point until the claim is reviewed.
Separate the experiments from routine development.
Most development work is routine engineering, and that stays out. The claim covers the experiments and the work directly needed to run them.
Work to examine
- Experiments on a device, software, assay, imaging or manufacturing problem nobody had solved
- Support work directly needed for those experiments, in proportion to them
- Salaries, materials used up and outside contractors for that work
- Prototypes and approaches that didn’t work but moved the investigation forward
Work to keep outside the claim
- Routine coding, configuration, testing or debugging using established methods
- Ordinary quality assurance, certification and regulatory paperwork
- Market research, sales, cosmetic design and commercial rollout
- Improvements that didn’t need any new technical knowledge
Medtech SR&ED questions
What medtech work may qualify for SR&ED?
When a device, diagnostic, imaging, software or production problem couldn’t be solved with existing knowledge, and your team ran planned experiments to work it out.
Does routine verification or validation qualify?
Routine testing against known requirements usually doesn’t, on its own. Experimental work inside verification or validation can qualify when it tackles a technical problem nobody had solved.
Can prototypes that didn’t work be included?
Yes. A prototype that didn’t work can be part of the claim if it tested an idea and moved the investigation forward. The product doesn’t need to succeed commercially either.
Which medtech development costs may be included?
Depending on the facts: salaries and wages, materials used up or transformed, and payments to outside contractors for the SR&ED work.
Related articles
- Medical SR&ED claim supportHow Ethan prepares a medical SR&ED claim, start to finish.
- What counts as scientific uncertainty?How to tell a hard build from the kind of problem SR&ED is about.
- When routine data collection may qualifyGathering results versus testing a method nobody knew would work.
- Documents to keepThe technical and financial records worth keeping.
Official sources
Program guidance reviewed August 1, 2026.
Wondering if your development work qualifies?
Walk Ethan through the technical problem and what your team tried. A 15-minute call is usually enough to tell.