Finance Your Refundable Tax Credits
Tax credits are claimed on your tax return after the end of the fiscal year. Often, more than a year passes between paying salaries and invoices and receiving the refundable portion of these tax credits. This can put a strain on your company’s cash flow.
You can ask your financial institution to finance these credits. However, few bank advisors are willing to do so because they are often unfamiliar with these credits and their associated risks. Here are two financing alternatives where we can help you.
Investissement Québec
Investissement Québec offers two financing solutions for refundable tax credits :
Loan
With this option, you can immediately obtain up to 100% of the expected amount of refundable tax credits for a fiscal year. The minimum financing is $50,000 for SR&ED tax credits and $20,000 for other refundable tax credits.
Loan Guarantee
Investissement Québec offers a loan guarantee of up to 80% of the net loss, if applicable. This guarantee virtually eliminates all risk for your financial institution. This will typically be reflected in the interest rates they offer.
The Opportunity
Reasonable Private Financing
Few institutional lenders finance refundable tax credits, creating fertile ground for private lenders offering exorbitant rates.
For over 25 years, R&D Action has cultivated a privileged relationship with a quasi-bank based in Quebec that specializes in financing refundable tax credits.
When your annual refundable tax credits exceed $250,000 and you have a positive credit history, we can recommend this reputable lender whose financing terms are equal to or even better than those of Investissement Québec loans.
In some cases, this institution even lends against current-year credits. It can even disburse funds on the first day of each quarter, before expenses have even been paid! This dramatically changes your cash flow, doesn’t it?
Cashing in faster cash flow minimizes the impact on your cash flow.
Quickly recovering a portion of your refundable tax credits transforms your business’s cash position.
Ask an expert
Contact us for a personalized consultation today.
See other programs of interest? Our team is composed of experts from all technological fields. We will adapt and understand these measures to process your claims.
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