What is the SR&ED tax credit rate in Ontario?

Ontario has two credits on top of the federal SR&ED credit. The Ontario innovation tax credit (OITC) is 8% and refundable, on up to $3 million of qualified spending, for corporations under the taxable income and taxable capital thresholds. The Ontario research and development tax credit (ORDTC) is 3.5% and non-refundable, with no spending cap. Both are claimed with the T2 return.

Did Ontario raise the OITC limit to $6 million like the federal credit?

No, not as of October 2026. Ontario's own OITC page still sets the expenditure limit at $3 million, phased out between $500,000 and $800,000 of prior-year taxable income and between $25 million and $50 million of taxable capital. We found no announced Ontario change, and the federal limit of $6 million doesn't carry over automatically. Check Ontario's page before you file.

What is the Quebec SR&ED tax credit rate in 2026?

For tax years that began after March 25, 2025, Quebec's main R&D credit is the refundable CRIC: 30% on eligible spending above an exclusion threshold (at least $50,000) up to $1 million, and 20% above $1 million. Only half of subcontract payments count. It replaced the older Quebec R&D salary credit and several related measures.

Is the Alberta Innovation Employment Grant the same as an Alberta SR&ED credit?

It's Alberta's version. The Innovation Employment Grant uses the same expenditures as federal SR&ED, carried out in Alberta. It pays 8% up to your base (the average of the previous two years) and 20% above it, on up to $4 million a year. You claim it on Schedule 29 of the Alberta AT1 return.

Do provincial credits reduce my federal SR&ED credit?

Yes. The CRA treats a provincial or territorial R&D tax credit as government assistance, so it reduces your qualified expenditures before the federal 35% or 15% rate applies. You still come out ahead, because you keep the provincial credit, but your federal credit is smaller than if you ignored the provincial one.

Which provinces have no SR&ED tax credit?

Prince Edward Island, the Northwest Territories and Nunavut have no provincial or territorial R&D tax credit, according to the CRA. Corporations there can still claim the full federal SR&ED credit, and their federal base isn't reduced by any provincial assistance.

Provincial SR&ED tax credits in 2026: rates, limits and how they stack

Most provinces add their own R&D credit on top of federal SR&ED. As of October 2026: Ontario pays 8% (OITC, refundable, on $3 million) plus 3.5% (ORDTC); Quebec's CRIC pays 30% and 20%; BC pays 10%; Alberta's Innovation Employment Grant pays 8% and 20%; Saskatchewan pays 10%; Manitoba and the Atlantic provinces pay 15%. Provincial credits reduce your federal base.

This is an independent guide. ClearSRED is not affiliated with the Canada Revenue Agency or any provincial government. It covers corporations; some credits also have rules for individuals and partnerships.

What are the provincial SR&ED tax credit rates in 2026?

Here is every provincial and territorial R&D credit, with the official source for each row. "Refundable" means you get cash even if you owe no provincial tax; a non-refundable credit only reduces tax payable (or carries back or forward).

Province	Credit	Rate	Limit / cap	Refundable?	Who qualifies	Form	Source	As of
Ontario	Ontario innovation tax credit (OITC)	8%	$3 million of spending; phased out at prior-year taxable income $500,000–$800,000 and taxable capital $25 million–$50 million	Yes	Corporations with a permanent establishment in Ontario doing SR&ED there	Schedule 566	ontario.ca	2026-10-23
Ontario	Ontario research and development tax credit (ORDTC)	3.5%	No cap	No (3 years back, 20 forward)	Same as OITC	Schedule 508	ontario.ca	2026-10-23
Quebec	Research, innovation and commercialization tax credit (CRIC)	30% up to $1 million; 20% above	Exclusion threshold of at least $50,000; no upper cap	Yes	Corporations with an establishment in Quebec; tax years beginning after 2025-03-25	RD-1029.8.CR	quebec.ca	2026-10-23
British Columbia	BC SR&ED tax credit	10%	Refundable part on spending up to the federal expenditure limit ($6 million, phased out at taxable capital $15 million–$75 million)	Yes for CCPCs and ECPCs up to the limit; otherwise no	Corporations doing SR&ED in BC	T666	gov.bc.ca	2026-10-23
Alberta	Innovation Employment Grant (IEG)	8% up to base; 20% above base	Up to $4 million of spending a year; phased out at taxable capital $10 million–$50 million	Yes (grant)	Corporations doing SR&ED-eligible work in Alberta	AT1 Schedule 29	alberta.ca	2026-10-23
Saskatchewan	Saskatchewan R&D tax credit	10%	Refundable on the first $2 million for CCPCs; total credit capped at $1 million a year	Partly	Corporations doing R&D in Saskatchewan	Schedule 403	saskatchewan.ca	2026-10-23
Manitoba	Manitoba R&D tax credit	15%	No cap	Half refundable for in-house work; fully refundable for contracts with qualifying research institutes	Corporations with a permanent establishment in Manitoba	Schedule 380	gov.mb.ca	2026-10-23
New Brunswick	NB R&D tax credit	15%	None stated	Yes	Corporations doing R&D in NB	Schedule 360	CRA	CRA page dated 2024-01-23
Nova Scotia	NS R&D tax credit	15%	None stated	Yes	Corporations doing R&D in NS	Schedule 340	CRA	CRA page dated 2024-01-23
Newfoundland and Labrador	NL R&D tax credit	15%	None stated	Yes	Corporations doing R&D in NL	Schedule 301	CRA	CRA page dated 2024-01-23
Yukon	Yukon R&D tax credit	15%, plus 5% on payments to Yukon University	None stated	Yes	Corporations doing R&D in Yukon	Schedule 442	CRA	CRA page dated 2024-01-23
PEI, NWT, Nunavut	None	None	None	None	Federal SR&ED only	None	CRA	CRA page dated 2024-01-23

"As of 2026-10-23" means we checked the provincial source on that date. Rows that rely on the CRA's summary page (last updated January 2024) were cross-checked against 2026 practitioner tax tables.

How do provincial credits stack with the federal SR&ED credit?

You get both, but the provincial credit comes first and shrinks the federal base. The CRA's policy says plainly: "A provincial or territorial R&D tax credit is government assistance," and it reduces your qualified SR&ED expenditures. This applies whichever overhead method you use; under the proxy method, the part of the provincial credit that relates to the prescribed proxy amount also reduces qualified expenditures.

Assistance counts once you have received it, are entitled to it, or can reasonably expect to receive it. In practice that means you calculate the provincial credit for the year, subtract it from your qualified expenditures, then apply the federal 35% (or 15%) rate to what's left.

Worked example: a fictional Ontario software company

Northwind Labs is a fictional Ontario CCPC. Last year it had taxable income under $500,000 and taxable capital well under $15 million. This year it has $1,000,000 of qualified SR&ED expenditures, all current (no capital).

Step	Calculation	Amount
1. OITC (refundable)	8% × $1,000,000	$80,000
2. ORDTC (non-refundable)	3.5% × ($1,000,000 − $80,000), because the OITC is assistance for the ORDTC	$32,200
3. Federal base	$1,000,000 − $80,000 − $32,200	$887,800
4. Federal ITC (enhanced, refundable)	35% × $887,800	$310,730
Total credits	$80,000 + $32,200 + $310,730	$422,930

If you added the rates naively (35% + 8% + 3.5% on $1,000,000), you would expect $465,000, which overstates the total by $42,070. Most of the difference ($39,270) is the federal 35% lost on the $112,200 of provincial credits; the rest ($2,800) is the ORDTC lost because the OITC reduces its base. The cash part this year is $390,730 (OITC plus federal ITC); the ORDTC only helps once Northwind owes Ontario tax.

The SR&ED calculator applies this ordering automatically for every province. For how the $6 million federal limit and its phase-out work, see the SR&ED expenditure limit 2026 guide.

Ontario: OITC and ORDTC

Ontario has the most layered system: a refundable 8% credit for smaller companies and a non-refundable 3.5% credit for any eligible corporation.

OITC: 8% on up to $3 million of Ontario SR&ED spending, so the maximum is $240,000 a year. The $3 million limit shrinks once prior-year federal taxable income passes $500,000 (gone at $800,000) or prior-year taxable capital passes $25 million (gone at $50 million). Claim it on Schedule 566.
ORDTC: 3.5%, non-refundable, with a 3-year carryback and 20-year carryforward. The OITC reduces its base. Claim it on Schedule 508.
What changed in 2025–26: nothing. Unlike BC and Saskatchewan, Ontario has not matched the federal $6 million limit or the $15 million–$75 million phase-out. Ontario's own OITC page still shows $3 million, and the 2026 Ontario budget (tabled March 26, 2026) did not change the OITC or ORDTC (2026 Ontario budget tax highlights).

Ontario also has a separate 20% refundable business-research institute tax credit for SR&ED contracted with eligible research institutes; check the current rules with Ontario's OBRITC page.

Quebec: the CRIC replaced the older R&D credits

For tax years that began after March 25, 2025, Quebec's main R&D incentive is the refundable research, innovation and commercialization tax credit (CRIC).

Rates: 30% on eligible spending above the exclusion threshold, up to $1 million, and 20% above $1 million.
Exclusion threshold: the greater of $50,000 and the total of the basic personal amount for each employee, adjusted for time spent on eligible work.
What counts: salaries and wages, 50% of payments to Quebec subcontractors, 50% of payments to eligible universities and public research centres, and equipment (not buildings or land). Note this is a narrower base than federal SR&ED: there is no overhead proxy and materials are not listed.
What it replaced: the 2025–26 Quebec budget consolidated several R&D measures into the CRIC, including the R&D salaries and wages credit and the university research credit (Quebec budget 2025–26). You can't claim the CRIC and another Quebec credit (such as the C3i) on the same expense.
Form: RD-1029.8.CR, filed with the Quebec corporate return.

British Columbia: 10%, now permanent and aligned with $6 million

BC's credit is 10%, and Budget 2026 made it permanent and matched it to the new federal rules.

The refundable credit is 10% of the lesser of your BC qualified expenditures and the expenditure limit, for CCPCs and (newly) eligible Canadian public corporations. Spending above that earns a 10% non-refundable credit (3 years back, 10 forward).
For tax years beginning on or after December 16, 2024, the limit is $6 million, phased out between $15 million and $75 million of prior-year taxable capital, and capital expenditures qualify again.
File form T666 with the T2, within 18 months after the tax year end.

Alberta: Innovation Employment Grant

Alberta doesn't call it an SR&ED credit, but the Innovation Employment Grant (IEG) uses the same eligible expenditures, carried out in Alberta.

8% on spending up to your base level (the average of the previous two years' qualifying spending) and 20% on spending above it, on up to $4 million a year. Growing R&D budgets get more.
Phased out between $10 million and $50 million of taxable capital.
No separate application: file Schedule 29 with the AT1 return. Payment waits until the CRA has verified the expenditures and Alberta confirms they were incurred in Alberta.

Doing R&D in more than one province?

We prepare the federal T661 and Schedule 31 plus the matching provincial schedules from your own engineering records, and an experienced SR&ED reviewer checks every claim.

Saskatchewan: refundable limit doubled to $2 million

Saskatchewan pays 10%. Since December 16, 2024, CCPCs get it as a refundable credit on the first $2 million of qualifying spending a year (up from $1 million), matching the federal timing. Spending above that, and spending by other corporations, earns a 10% non-refundable credit. Total credits claimed are limited to $1 million a year. Claim it on Schedule 403.

Manitoba: 15%, half refundable

Manitoba's credit is 15% for spending after April 11, 2017. Half is refundable for in-house R&D; R&D done under an eligible contract with a qualifying research institute is fully refundable. Unused credits carry back 3 years and forward 20. Claim it on Schedule 380.

Atlantic provinces: New Brunswick, Nova Scotia, Newfoundland and Labrador

All three pay a fully refundable 15% credit, according to the CRA's provincial summary. Claim it on Schedule 360 (NB), 340 (NS) or 301 (NL). Nova Scotia's deadline is 18 months after the tax year end; Newfoundland and Labrador's is 12 months after the filing due date. We found no announced 2025–26 changes; the CRA summary (January 2024) matches 2026 practitioner tax tables (RCGT 2026 SR&ED tables).

Territories and Prince Edward Island

Yukon pays a refundable 15%, plus 5% on amounts paid to Yukon University (Schedule 442, due 12 months after the filing due date). Prince Edward Island, the Northwest Territories and Nunavut have no R&D tax credit, so companies there claim federal SR&ED only, on an unreduced base.

Ready to file? Our guide to filing an SR&ED claim covers the T661, Schedule 31, deadlines and where the provincial schedules fit.