Toronto, Ontario SR&ED Local Authority

In 2026, the Ontario innovation landscape is built on three primary pillars. At GrowWise, we work with our clients to maximize total SR&ED recovery (which can reach over 65% when combined with federal credits).

1. Ontario Innovation Tax Credit (OITC)

This is the most critical Provincial R&D tax credit for Toronto startups and SMEs (CCPCs).

• The Benefit: An 8% refundable tax credit on the same R&D expenditures used for your federal SR&ED claim.

• Toronto Context: For a Toronto-based company, this credit turns a 35% federal refund into a 43% combined refund.

• Key Limit: Applies to the first $3 million in qualifying annual expenditures.

2. Ontario Research and Development Tax Credit (ORDTC)

This non-refundable Provincial Tax Credit reduces tax payable.

• The Benefit: A 3.5% non-refundable tax credit.

• Toronto Context: The ORDTC is often the primary provincial vehicle for reducing corporate income tax payable for Toronto-based growing companies.

• Flexibility: Unused credits can be carried back 3 years or forward 20 years.

3. Ontario Business-Research Institute Tax Credit (OBRICT)

This is the “Secret Weapon” for Toronto companies collaborating with the city’s academic powerhouses like UofT.

• The Benefit: A 20% refundable tax credit for R&D work performed under contract with eligible research institutes.

• Toronto Context: If a Toronto company contracts UHN, the University of Toronto, or Schwartz Reisman to perform research, they can claim this 20% on top of federal incentives.

• Cap: A massive $20 million annual expenditure limit, allowing for a maximum credit of $4 million per year.