Are you a scaling company looking to grow your technical team in 2026? If you are planning to hire engineers, developers, or other technical team members in 2026, there are two questions you need to answer:
- Are these employees going to be eligible for SR&ED?
- If yes, how do I maximize my SR&ED claim with a scaling team?
This blog will answer both of those questions and leave you with actionable steps to implement today to maximize SR&ED with new employees in 2026. In 2026, you don’t want to leave money on the table by not understanding your SR&ED eligibility or not tracking your projects properly.
Is Your New-Hire SR&ED Eligible?
We made this flow chart for you to easily be able to understand if your new team members will be SR&ED eligible in 2026.
Now that you understand if the team member is eligible for SR&ED funding, assuming that they are, the next step is to implement the systems to track their work to maximize SR&ED with new employees.
Maximizing Your SR&ED Claim with a Scaling Team
There are two critical components to filing a strong SR&ED claim that can withstand CRA scrutiny. You need to be able to show the technical eligibility and the financial data to back up your claim. The stronger this information, the stronger your claim will be, the more confidence you will have in your data, and therefore the larger your SR&ED claims will be.
Tracking Technical Narratives for SR&ED
For the technical eligibility, if you want to maximize SR&ED with new employees, you need to be able to answer three key questions. These answers can be gathered and compiled from various documents, emails, or data such as Jira files, GitHub commits, project management tracking software or other sources. To the CRA, it does not matter where this information is stored, but you must be able to answer these three questions:
- What is the technical uncertainty that you faced? What is the specific knowledge gap, or lack of existing information, that you are aiming to address?
- What tests, experiments and activities are you doing to address the technical uncertainty? In order to be SR&ED eligible, your project needs to involve systematic experimentation.
- What did you learn? Even if the project didn’t successfully meet the goals or targets you set out to achieve, you can still qualify for SR&ED as long as lessons were learned about what works or doesn’t work.
It is essential that you build systems to track and document the answers to the three above questions. As your team scales, and the founders, CEO/CFO/CTO become farther up the chain from the individuals actually completing this technical work, it is critical that you build systems so that your SR&ED is properly documented so that you’re not leaving money on the table.
Every new employee should be trained on what SR&ED is, what is eligible and what is not, and how to properly track their technical work related to SR&ED.
If you are not currently tracking SR&ED projects, this article, SR&ED Tracking in 2026, explains how to track and how to build tracking into your existing tools, such as Jira, GitHub, ClickUp, or Excel spreadsheets.
If your SR&ED claim ever gets audited/reviewed, which about 5-10% of claims do every year, it is critical that you are able to answer the three questions and provide evidence of those answers. If you cannot provide data and evidence to show the answers to the three questions, most specifically the evidence that you did experiments and ran iterative testing, your SR&ED claim will likely be reduced, if not denied by the CRA. More information about SR&ED audits here.
Tracking Financial Details for SR&ED
The second aspect of maximizing SR&ED with new employees and a scaling team in 2026 is the financial details that need to be tracked. The core of the financial tracking (relating to employee time) is that the CRA needs to be able to see that you can prove (with data) what employees spent what percentage of their time on each SR&ED project in each month throughout the fiscal year. This determines what percentage of their time you can claim as SR&ED eligible, and therefore, what percentage you can receive a refund for through SR&ED.
What matters most is having a consistent and defensible way to track how employee time is actually spent across projects, month by month. For SR&ED purposes, the CRA is not looking for perfection, but they do expect that time allocations are based on real records created while the work was happening. Statements like “I would guess they spent around 40 percent of their time last January” are exactly the type of assumptions that fall apart in an SR&ED review and lead to reduced claims.
This challenge is one many growing teams run into, especially as headcount increases and work becomes more distributed across projects. Time tracking for SR&ED does not mean stopwatch-level logging or daily timesheets. What it does require is a reasonable system that links people, projects, and technical work in a way that can be supported with evidence.
That is the gap GrowWise was built to address. Our AI-driven platform provides a structured way to track SR&ED projects and allocate time without adding a heavy process for engineering teams. In parallel, it can also pull evidence from work that already exists across your tools and documentation. Jira tickets, GitHub commits, technical notes, emails, and design documents often already capture what was worked on, what was tried, and how things evolved. By connecting those records, SR&ED time and activity can be supported using data that teams naturally produce, reducing the need for long interviews or after-the-fact questionnaires. This approach helps keep SR&ED tracking accurate throughout the year and makes the claim process far more straightforward at year-end.
Tips for Maximizing SR&ED with New Employees
#1.
Dedicate specific employees to specific SR&ED projects whenever possible.
For example, if you need to scale your platform and you need a ton of testing and designing to be done to improve the security or scalability of your platform, but with that, you also need a ton of work done to fix small bugs, redesign the UI/UX, and improve the quality of the database.
If you hire two general developers, and they both do some of the technical problem solving, testing and iterating, as well as the bug-fixing, and basic tasks like UI/UX development, that means they are both partially SR&ED eligible, which makes SR&ED tracking significantly more complex. Whereas, if you hire one more senior developer to do the complicated, challenging testing and design work, and then one more junior developer to fix bugs, and do the simpler, more straightforward tasks, your SR&ED tracking will be much simpler.
In the second case, with one dedicated employee working on the SR&ED eligible activities, their whole salary is SR&ED eligible. You still have to be able to prove that the work they did does, in fact, meet the technical requirements of SR&ED, but you don’t need to worry about time tracking if those activities are all they are working on. If you have two employees, each doing some SR&ED work and some non-SR&ED work, both employees would have to track their time to properly be able to allocate to SR&ED projects.
#2.
Hire employees, not contractors. Assuming an individual works only on SR&ED eligible activities, if they are hired as an employee, you can receive up to two-thirds of their salary back through the SR&ED program. If they are hired as a contractor, you can only receive a refund for ~40% of their costs.
Use our SR&ED calculator now to estimate your SR&ED claim and understand the difference between employees and contractors.
#3.
Train your whole team to identify SR&ED projects early. As teams grow, roles naturally become more mixed. Without clear separation, experimental work often gets buried under production, support, and delivery tasks. Defining SR&ED projects early, assigning employee/team ownership, and allocating time intentionally helps preserve eligibility and prevents claim value from quietly eroding as the company scales.
#4.
Add an “SR&ED project” field or tag to your task tool. Do not change how your team works. The best SR&ED tracking is the sustainable one.
A great way to capture SR&ED eligible work as it happens is to build an “SR&ED” or “Project A” tag directly in your project management software, such as Jira, Asana, ClickUp or whatever you use. This creates automatic, timestamped evidence that shows who worked on what and when, without asking engineers to do anything extra.
#5.
Capture failed attempts intentionally.
Teams are great at documenting what worked and terrible at keeping records of what did not work. From an SR&ED perspective, failed experiments are often the strongest evidence that the work does indeed qualify. Encourage teams to save test results, logs, design notes, or short summaries when something does not work. This takes minutes and can materially strengthen a claim.
#6.
Build a culture of SR&ED. SR&ED should not be an afterthought in your company. As frustrating as it is to have another thing to think about, you will leave money on the table if you don’t build SR&ED into your business and build a culture around it.
The SR&ED-eligible work is often the work that actually moves companies along and helps them scale. It is the tough, challenging work that moves the needle. By building a company culture that not only supports but also encourages employees to focus on SR&ED eligible work, not only will your claim be larger and stronger, but your company will inherently have more innovation, larger moats and more innovative technology.
