SR&ED vs. IRAP vs. EDC: Which Program Fits Your Innovation Best?

Navoriah
Jul 18
3 min read

Updated: Jul 31

Published on: 19 July, 2025

Author: Team Navoriah

A guide for Canadian food, agri-tech, and clean innovation companies navigating funding and support.

In Canada, innovation funding isn't one-size-fits-all. If you're developing a new product, process, or technology in the food, agri-tech, or clean innovation space, you're likely evaluating SR&ED, IRAP, or EDC support. Each program offers distinct benefits, but choosing the right one depends on your project's stage, risk profile, and commercialization path.

This guide helps you compare SR&ED, IRAP, and EDC, so you can fund your innovation with clarity—and confidence.

Infographic comparing Canadian innovation funding programs SR&ED, IRAP, and EDC. — Compare Canada’s top funding programs—SR&ED, IRAP, and EDC—to see which one aligns best with your innovation stage. A quick guide to Canadian innovation funding

1. SR&ED: Scientific Research & Experimental Development

Best For: R&D activities with technical uncertainty (e.g., developing a new formulation, process, or prototype)Type: Federal tax credit (with provincial top-ups)Stage: Post-spending (filed during tax return)

✅ What You Get:

Refundable tax credits of up to 35% for Canadian-controlled private corporations (CCPCs)
Non-refundable ~15–20% for larger firms
Covers: salaries, materials, subcontractors, and overhead

🚧 Watch Out:

Must document technical challenges and experiments
Requires detailed records and time tracking
You receive support after the R&D spend

💡 SR&ED is ideal if you're actively developing IP or improving processes through technical iterations.

2. IRAP: Industrial Research Assistance Program (NRC-IRAP)

Best For: Early- to mid-stage innovation projects needing cash-flow supportType: Direct, non-repayable fundingStage: Upfront or during project execution

✅ What You Get:

80% of salaries and 50% of subcontractor costs for eligible R&D
Funding for prototyping, scaling, and technical feasibility studies
A dedicated Industrial Technology Advisor (ITA) helps shape your project

🚧 Watch Out:

Competitive and requires strong project framing
Must show commercial potential
Reporting and milestone tracking are rigorous

💡 IRAP is best for startups or SMEs launching a new product or improving technology with real-time funding support.

3. EDC: Export Development Canada

Best For: Companies ready to scale or export with growing international demandType: Financial products (loans, insurance, working capital, guarantees)Stage: Post-R&D, early commercialization and market expansion.

✅ What You Get:

Export insurance and credit guarantees
Access to working capital
Market intelligence, introductions, and trade resources
Tailored support for cleantech and agri-food exporters

🚧 Watch Out:

Not a grant—this is financial enablement, not non-repayable funding
Must show strong financials and export readiness

💡 EDC is perfect for companies entering new markets or scaling up exports after development.

Which One Should You Choose?

Criteria	SR&ED	IRAP	EDC
Funding Type	Tax Credit (Refundable/NR)	Non-repayable Contribution	Loans / Insurance / Capital Access
Stage	Post-R&D	In-progress R&D / early scaling	Commercialization / Export
Best For	Technical R&D	Product development & feasibility	International expansion
Cash Flow Timing	After spending (tax season)	During project	As needed for scale/export
Ease of Access	Medium (via CRA filing)	Competitive + ITA support	Moderate (requires export case)