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12 Jul

THE ELIGIBILITY CRITERIA – ADVANCEMENT – PART 2/3

This is a second post of a three-part series explaining the SR&ED eligibility criteria. This series will explore the definition and application of the three eligibility criteria, namely: Uncertainty, Advancement and Systematic Investigation.

In the last article, we discussed the fact that an uncertainty refers to a problem not resolvable using generally accessible knowledge. In this post we will discuss the term advancement, how it relates to an uncertainty and how it may be met.

THE SECOND CRITERION

An advancement in technology sounds quite self-explanatory. It refers to the newly developed technology. Incorrect. It refers to the generation of knowledge through research or experimentation.

As quoted in the previous entry, an uncertainty refers to the problem which may not be resolved using generally accessible knowledge in a given field. The advancement refers to the generation of knowledge through the resolution of an uncertainty. It has been said that an advancement in technology is inextricably linked to the resolution of an uncertainty.

A COMPETENT PROFESSIONAL

Previously we quoted then Justice Bowman to have stated that in order to qualify as an advancement or uncertainty, the knowledge gained must not be generally accessible to a competent professional in his field. This brings up the following questions: Who qualifies as a competent professional? Must an individual involved in a SR&ED claim hold a degree in the specific area of technology under which the claim is filed?

Notice Justice Bowman’s words in Northwest Hydraulic Consultants Ltd. v. The Queen,1998 TC 531 paragraph 16 (b):

(b) What is “routine engineering”? It is this question, (as well as that relating to technological advancement) that appears to have divided the experts more than any other. Briefly it describes techniques, procedures and data that are generally accessible to competent professionals in the field.

After stating that the definition relating to a technological advancement has often divided the experts, he pointed to the techniques, procedures and data which were available to the professionals, not the professionals themselves. Nowhere in law does it say that an individual must hold a degree in a specific area of technology to make an SR&ED claim.