Guess how many kinds of wage subsidies, grants, contributions and financial assistance are provided by Canada government? The answer is 339 different programs! Amazing, isn't it? The inevitably following question is: how can I have a finger in the pie? As one of the most hard-working groups in Canada, we the Chinese rarely ask that question, which makes us miss considerable opportunities, sometimes crucial. To help you better understand these corporation benefits from the government, which essentially are out of the pockets of us taxpayers, and to claim what you deserve eventually, is the goal of this speech. To find more about Startup 4 Chinese @ GTA, please visit: http://www.startup4chinese.com

1. YOUR JOURNEY
MAY3, 2017
PRESENTED BY EDDIE LEE
How to Get Money from Canada
Government for Your Startup
Eddie Lee
November 25, 2017
Startup 4 Chinese @GTA

2. The Take-Away Message
• Introduction
• Scientific Research and Experimental Development (SR&ED)
• Other Interesting Grants
• Starter Company Plus
• Tips and Useful Links
• Questions

3. About Eddie
• EDDIE IS THE EXECUTIVE PARTNER, FOUNDER OF FIRST FINANCIAL CONTROLLER AND CANADA
BUSINESS ENTERPRISE. HE IS CURRENTLY MANAGING A DOZEN COMPANIES IN CANADA AND
OVERSEAS AS CFO AND SENIOR EXECUTIVE.
• HE HELD A SENIOR FINANCIAL POSITION FOR MANY YEARS AT ACER GROUP. DURING HIS
ENGAGEMENT, EDDIE IMPLEMENTED SPECIAL PROJECTS FOR ACER, WHICH HELPED ACER BUILD
FUNCTIONAL EXCELLENCE AND ACCELERATE GROWTH.
• EDDIE PROVED THE EFFECTIVENESS OF HIS LEADERSHIP WITH EXTENSIVE EXPERIENCE IN CITIES
ACROSS THE GLOBE INCLUDING TORONTO, WINNIPEG, LONDON, ZURICH, MILAN, PARIS, SAN
JOSE, BARCELONA, STOCKHOLM, HONG KONG, TAIPEI, BEIJING AND SHANGHAI.
• EDDIE STARTED HIS FINANCIAL CAREER IN MANDARIN ORIENTAL HOTEL GROUP IN 1981. IN 1986,
HE JOINED A PIONEERING FIRM TO ESTABLISH FIVE WORLD-CLASS RESTAURANTS IN THE SHENZHEN
INTERNATIONAL TRADE BUSINESS CENTRE. MORE RECENTLY, EDDIE WORKED WITH ONE OF THE
CANADA’S LARGEST WOMEN’S FASHION COMPANIES, TO HELP IT GROW AND REDUCE COST.
• IN 2000, EDDIE WORKED AS A VENTURE CAPITALIST RESPONSIBLE FOR EXECUTING INVESTMENT
OPPORTUNITIES, AND PROVIDED INCUBATOR SUPPORT FOR STARTUPS IN SHANGHAI AND HONG
KONG.

4. Fashion &
Apparel
Green
Aerospace Film
Technology
Life Science
Tourism
Employee 1-19, representing 1M Employers
account for over 86% of Employer Business
(Sources : Key Small Business Statistics 2016
– Innovation, Science & Development of Canada)

5. Scientific Research and Experimental
Development (SE&ED) Tax Incentive Goal
• To provide a long-term benefit on strength and competitiveness of the entity
and Canadian economy.
• Benefit of expenditures
• Ongoing expenditures, can be deducted in full in the year incurred.
• Expenditures include salaries, and wages, supplies, payments to approved
universities or other business entities for research work, contract expenses, 3rd
parties payments, materials cost.
• The business can choose not to deduct any of the above items when incurred but
instead carry them forward indefinitely as a deduction for any future year
• Improve cash flow – cost deducted immediately to create tax saving
• For activity carries outside Canada, the costs of tangible assets cannot be
deducted in full

6. SE&ED Tax Incentives Not Apply to
Routine Engineering Development
• Does not apply to
• market research or sales promotion;
• quality control or routine testing of materials, devices, products or processes;
• research in the social sciences or the humanities;
• prospecting, exploring or drilling for, or producing, minerals, petroleum or natural gas;
• the commercial production of a new or improved material, device or product or the commercial use
of a new or improved process;
• style changes; or
• routine data collection.
Apparently, it is not intended to “include routine engineering or routine product
development

7. R&D and SR&ED Period
Concept
Feasibility
Search
Functional
Requirements
Design
Project Plan
Development
Phase
Analysis
Testing
Product
Launch
Commercialized

8. SR&ED Investment Tax Credit Rates
• Qualified SR&ED expenditures may also be eligible to receive an investment tax
credit (ITC) to reduce the income tax payable and/or create a cash refund
• ITC is claimed or refund, the amount is deducted from the pool of unused
SR&ED exp. in the following year. If pool is insufficient, the remainder is added
to income
• CCPC (Canadian Control Private Corporation
• Investment Tax Credit (ITC) Rates 35%
• Applies up to $3M
• After $3M becomes 15%
• Rate of Refund on Current Expenditures 100%
• Canadian Corporation
• ITC Rates 15%
• Individuals
• ITC Rates 15%
• Rate of Refund 40%

9. Research & Technology Aspects
• Was there a scientific or technological uncertainty
• Did the effort involve formulating hypotheses specifically
aimed at reducing or eliminating that uncertainly
• Was the overall approach adopted consistent with a
systematic investigation or search, including formulating
and testing the hypotheses by means of experiment or
analysis
• Was the overall approach undertaken for the purpose of
achieving a scientific or a technological advancement
• Was a record of the hypotheses tested and the results
kept as the work progressed

10. What are the Claimable Expenditures
• Directly salaries and wages
• Based on the time spent on SR&ED, salaries MUST be T4
• Includes regular vacation time, holidays, sick leave and some taxable
benefits
• Paid within 180 days of the end of the fiscal year
• Specified Employees (non arms length, or owns 10% or more company
shares
• CAP 5 x YMPE (Year’s Maximum Pensionable Earning)
• Limited to 75% of total salary for proxy purpose
• Materials consumed and/or transformed
• Contractors
• Overhead (Traditional Only)
• 3rd party payments

11. What are the Non Claimable
• Administration salaries
• Legal and accounting fees
• IP, Patents and royalties fees
• Interest fees
• Entertainment expenses
• Advertising and marketing
• Membership dues
• Fines and penalties
• Cost of used equipment
• Acquisition of rights arising out of SR&ED
• Acquisition of building, rent, or leasehold improvements

12. Ontario R&D Tax Credits
• To provide an incentive to SME performing SR&ED in Ontario
• Has a permanent establishment in Ontario at any time during the taxation year
• Filed a Form T661 in the tax year
• Ontario Innovation Tax Credit (OITC) Schedule 566
• 8% refundable tax credit based on SR&ED expenditures *
• Ontario Research & Development Tax Credit (ORDTC) S508
• 3.5% non-refundable tax credit
• Ontario Business Research Institute Tax Credit (OBRITC) S568
• 20% refundable of qualified expenditures *
• Ontario Transitional Tax Debits and Credits (OTTDC) S506
• Eligible to claim an transitional tax credit
• Using T2 Schedule 5, Schedule 500

13. SR&ED Filing
• Files
• Form T661 – General, technical, expenditure and project cost
information
• Form T2038 – Individual claim
• Form T2 Schedule 31 – Corporation claim
• Form T2 Schedule 1 (Line 101 to 290; Line 401 to 510)
• Filing date
• Individuals T1 due date June 15.
• Corporations T2 due date 6 months after tax year-end
• Deadline : 12 months after the Income Tax Return (18-month
Rule”

14. SR&ED Documents Requirement
Financial Area
• Financial statement, general ledger, tax returns
• Minute book, shareholder’s ledger, organization chart
• Accounting records
• Detailed invoices, proof of payment
• Written contract agreements (Description of the work, date, agreed amount)
• T4, payroll, time sheets
• Documents related to grants
• Claimable expenditures receipts and payments supporting
• Cost for performing SR&ED (Wages, materials, and overhead costs)
• Cost for SR&ED performed on your behalf (Contractor payments)
• 3rd party payments – payments to certain entities, such as approved associations or
approved institutions to be used for SR&ED

15. SR&ED Documents Requirement
Research and Project area
• Project planning documents
• Records of resources allocated to the project, time sheets
• Design of experiments
• Project records, laboratory notebooks
• Design, system architecture and source code
• Records of trail runs
• Progress reports, minutes of project meetings
• Test protocols, test data, analysis of test results, conclusions
• Photographs and videos
• Samples and prototypes
• Contracts

16. Two Filing Methods
Traditional Method
• Specifically identity your overhead
• All overhead expenditures directly related and incremental to the SR&ED are
allowable
Proxy Method
• Percentage of directly engaged SR&ED salaries claimed in lieu of actual SR&ED
overhead
• Simpler alternative to the traditional method

17. Free Services and Tools
• The SR&ED Program offers free services
• First-time claimant advisory service (FTCAS)
• Pre-claim consultation (PCC) service
• Pre-claim review (PCR) plot
• Self-Assessment and Learning Tool (SALT)
• SR&ED Incentives Program
• www.canada.ca/taxes-sred

18. Questions

19. Ontario Centers of Excellence (OCE)
• TalentEdge Internship Program (TIP)
• It provides support for current college and university students (specifically
current graduate students and final year undergraduate students), and
recent Masters graduates (within three years of graduation), to work on
industry-driven research and development projects.
• TalentEdge internships are intended to provide interns with an experiential
learning opportunity and hands-on industry experience. All internships must
be project-based with clearly defined activities, milestones and outcomes.
• Projects must have a clearly-defined R&D component, where R&D is
defined by the discipline and is inclusive of all areas of specialization and
disciplines.
• 4-month internship is valued at $20,000 as follows:
• Program Fund
• Each four-month internship is valued at $20,000 as follows:
• $10,000 contribution from OCE
• $5,000 company cash contribution
• $5,000 company in-kind contribution

20. Eco Canada
• Employment Funding
• Receive up to $15,000 in wage funding when you hire a young professional
through our Internship Program.
• up to 50% of an intern’s salary (up to $15,000) for new full-time
environmental jobs
• Scopes – Eligible Roles (STEM)
• Science – Research
• Technology – Software designer
• Engineering – Environmental Engineer or Energy Engineer
• Mathematics
• Naturals resources
• Employer (Host)
• Offering a FT , permanent position
• Providing an environment-related position in STEM or natural resources
• Planning to hire a new employee (cannot have any previous working history with
the company)
• Host organization must be Canadian owned

21. Student Work-Integrated Learning
Program (SWILP)
• Organizations may receive $5,000 - $7,000 per co-op student for the fall 2017
and winter 2018 terms
• 50% up to $5,000 for all students
• 70% up to $7,000 for students within under-represented groups in
STEM (females, indigenous people, persons with disabilities, newcomers in
Canada five years or less, and first-year students
• Eligible employers
• organizations within the aviation and aerospace industry
• The program will focus on occupations in science, technology, engineering,
mathematics (STEM) and business
• Eligible students
• Participant is registered full-time in a science, technology engineering, math or
business program at a Canadian post-secondary institution
• Be legally entitled to work according to the relevant provincial legislation and
regulations

22. Canadian Heritage
• Canada Summer Jobs
• Canada Summer Jobs provides funding to not-for-profit organizations, public-
sector employers and small businesses with 50 or fewer employees to create
summer job opportunities for young people aged 15 to 30 years who are full-
time students intending to return to their studies in the next school year. It is
designed to focus on local priorities, while helping both students and their
communities.
supports organizations, including those that provide important community
services; and
• recognizes that local circumstances, community needs and priorities vary
widely.
• Programs
• Young Canada Works in Both Official Languages (YCWBOL)
• Young Canada Works in Heritage Organizations (YCWHO)

23. Co-operative Education Tax Credit
• For each qualifying work placement ending in the taxation year, an
eligible employer may claim a refundable tax credit for eligible
expenditures incurred after March 26, 2009, equal to the lesser of:
• 25 per cent (30 per cent for small businesses for qualifying work
placements) of the eligible expenditures made in respect of that work
placement, and
• $3,000.
• The maximum amount is prorated for qualifying work placements
straddling March 26, 2009. The proration is calculated using the following
formula:
• ($1,000 × X/Y) + [$3,000 × (Y − X)/Y] in which,
• X is the number of consecutive weeks of the qualifying work placement
completed by the student before March 27, 2009, and
• Y is the total number of consecutive weeks of the student's qualifying work
placement.
• The eligible employer's total tax credit for the taxation year is equal to the
sum of the tax credits for each qualifying work placement.

24. Advanced Education and Skills
Development
• Canada-Ontario Job Grant
• The Job Grant will provide direct financial support to individual
employers who wish to purchase training for their employees. It will
be available to small, medium and large businesses with a plan to
deliver short-term training to existing and new employees, and will:
• Provide up to $10,000 in government support per person for training
costs.
• Require employers to contribute one-third of the total costs. There
will be additional flexibility for small businesses to provide an in-kind
contribution towards their share of the costs.
• Require training to be delivered by an eligible, third-party trainer.

25. Eastern Ontario Development
Program
• If you live in rural Eastern Ontario, you could be eligible for a non-
repayable contribution of up to $100,000 to start or grow a business.
• Eligible projects for new businesses:
• Training and mentoring
• Starting up
• Eligible projects for existing businesses:
• Productivity improvements
• Market diversification
• Innovation and product development
• Succession planning
• To qualify, you must be able to fund 50% of the project. Other conditions
apply.

26. Northern Business Opportunity
Program (Northern Ontario)
• If you are running or planning to start a business in Northern Ontario
you could be eligible to apply for conditional grants or repayable
loans ranging, generally, from $200,000 to $1 million. Targeted
projects for this program include:
• Business expansion
• Film and television productions
• New investment from outside Northern Ontario
• Small business start-up
• Other conditions apply.

27. Starter Company Plus
• If you are an Ontario resident aged 18 and over and not attending
school full time, you may be eligible to apply for funding of up to $5,000
to start or expand your business. You could also receive:
• Startup Toronto $3,500
• Technology Stream $5,000
• One-on-one guidance from a business advisor
• Mentoring from a local entrepreneur
• Training through business workshops
• Business experience that could help you obtain other traditional
financing
• You need to contribute 25% of the grant in cash or in kind. Other
conditions apply.

28. Starter Company Plus (Con’t)
• Phase One – Basic Application
• Attend the introduction workshop organized by Enterprise Toronto
• Apply on-line application within 2 weeks
• Review and approval of your application
• Attend Business Training sessions approx. 8 weeks
• Phase Two – Detailed Plan Application
• Submit Business Plan
• Review by Grant committees
• Grant approval – if Score on 35 to 50 points
• Grant agreement signed
• Client assistance – bi-monthly engagement for 6 months with client to
provide assistance
• Mentoring

29. Starter Company Plus (Con’t)
• Check List
• Register Business Name
• Open a bank commercial account
• Keep all grant receipts – Proof of Grant allocation
• Bank statement tracking
• Online payments – Credit Card statement tracking
• Cash payments – Invoice & Receipt from vendors
• Allocation of Fund (Recommended)
• Marketing
• Equipment
• Insurance
• Staffing
• Commercial office space
• Inventory
• Social media / digital marketing
• PR Advertising

30. Concierge Innovation Programs
• Enquiry Service
• Concierge is a single access point to funding, expertise, facilities,
and global opportunities for small- and medium-sized enterprises
(SMEs) seeking to grow through innovation.
• Offers free, one-on-one assistance from expert advisors who provide
customized guidance in selecting the most relevant programs and
services to help you grow your business
• 1-855-534-8433 Monday to Friday: 7:30a.m. - 7:30p.m. ET Zone
• https://concierge.innovation.gc.ca/en/home

31. Be Prepared
• Setup your company – Incorporation (Provincial / Federal)
• In business for 2 years (Most of the requirement)
• Proof of Business Concept
• Revenue
• R&D Documentation
• Personal Engagement
• Business Plan
• Budget
• Clear and Precise Information
• Convincing activities
• Website
• Tax Planning

32. Others Funds
 Summer Grant $3,000 for Student
 Ontario Innovation Tax Credit based on 8% tax credit maxi $240K
 Ontario Media Development Corporation http://www.omdc.on.ca/
 Networks of Centres of Excellence of Canada http://www.nce-
rce.gc.ca/NetworksCentres-CentresReseaux/Index_eng.asp
 Ontario Centres of Excellence http://www.oce-ontario.org/
 Toronto Enterprise Fund http://www.torontoenterprisefund.ca/
 Smartstat Seed Fund http://www.oce-
ontario.org/programs/entrepreneurship-programs/smartstart-seed-
fund (Currently Closed)


33. Useful Links
• https://canadabusiness.ca/programs/#/?ft=2&fp=9&fp=1&fp=2&fp=
4&fp=5&fp=7&fp=8&page=1
• http://www.grants.gov.on.ca/GrantsPortal/en/OntarioGrants/Grant
Opportunities/index.htm
• http://yedi.wpengine.com//
• http://www.eco.ca/
• http://oce-ontario.org/programs/industry-academic-
collaboration/talentedge
• https://www.fin.gov.on.ca/en/credit/business.html
• https://www.mitacs.ca/en

34. Other Interesting Topics
• Jobs Market & Culture Differences
• Company Problems. The Headaches That Can Be Fixed
• Build Your Business Plan that Really Works
• Financial Budget Plan – The Most Important Element of Your
Business Plan
• Current Labor Market and Job Search Advice
• How to Improve You Company Operation Efficiency
• Fraud Protection (An Educational Session Sponsored by The
Chartered Professional Accountants of Canada)
• How to setup an eCommerce on Amazon
• DuPont Model
• Many more….

35. Questions
Keep In Touch!
o Mobile +1 (647) 938-4618
o Email eddie.lee@firstfinancialcontroller.ca
o LinkedIn www.linkedin.com/in/eddieknlee
o Company website www.firstfinancialcontroller.ca
www.canadabusiessenterprise.ca
www.onehub.ca