Many SR&ED tax credit claims earn interest due to the delay between the time of filing and the time of assessment. The March 4th 2010 budget proposes to reduce the rate of interest paid on overpayments of tax by corporations. In the budget it is proposed that rate which was formerly determined quarterly as 2% plus the average yield of three-month government treasury bills in the prior quarter rounded up to the nearest percentage point. The budget proposes that effective July 1, 2010 the interest rate formulae will no longer have a base of 2%. Base on current treasury-bill rates interest determined under the old rules would be 3% and under the new rules it would be 1%. The decrease at current rates is 67% of the interest formally paid.
Administrative Changes to the SR&ED Program
In the budget it was confirmed that CRA will post on its web site on a quarterly basis progress towards meeting its service standards. It also confirmed that the new technical review manual will be released in April 2010.
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