Startup Grants and Tax Credits in Quebec for 2026

In short: in 2026, Quebec startups have access to three main families of non-dilutive funding: innovation tax credits (enhanced federal SR&ED, Quebec's new CRIC, and the CDAE reformed for AI), direct contributions (NRC IRAP, CanExport SMEs, Mitacs) and public and quasi-public financing (BDC, EDC, Investissement Québec). Combined well, these programs can significantly reduce the real cost of R&D and expansion.

The landscape has changed a lot since 2025: an enhanced federal SR&ED program, a complete overhaul of Quebec's R&D tax credits and a new version of the CDAE. Here's an up-to-date overview. Always validate it with your tax advisor, since the parameters change and depend on your situation.

1. Federal SR&ED: more generous since Budget 2025

The Scientific Research and Experimental Development (SR&ED) program remains Canada's largest R&D tax incentive.

• Enhanced 35% refundable rate for eligible CCPCs.
• Expenditure limit raised to $6 million by the 2025 federal budget, after a first increase announced to $4.5 million. The refundable credit can therefore reach about $2.1 million a year.
• Phase-out thresholds based on taxable capital raised, according to published analyses, from $10M-$50M to $15M-$75M.
• Capital expenditures are back on the list of qualifying expenditures.
• General 15% non-refundable rate for other corporations, including subsidiaries of foreign groups.

Watch your structure: a Delaware flip generally means losing CCPC status, and with it the enhanced refundable rate. We explain this in our US expansion guide.

2. CRIC: Quebec's new innovation tax credit

Announced in Quebec's 2025-2026 budget, the tax credit for research, innovation and commercialization (CRIC) replaces several existing measures, including the R&D tax credits.

• Effective date: taxation years beginning after December 31, 2025.
• Rates: a 20% base rate and an enhanced 30% rate on the first $1 million of eligible expenditures above an exclusion threshold (Revenu Québec).
• What's new: pre-commercialization activities are included, broadening the scope compared with the former credits.
• Rate modulation: the rate depends on the volume of eligible expenditures rather than on company size.
• Eligibility: corporations that carry on a business in Quebec and have an establishment there.

See the Government of Quebec's official CRIC page for refund terms and calculation details.

3. The CDAE, reformed for artificial intelligence

The tax credit for the development of e-business (CDAE), widely used by software companies, is being replaced by a new version that includes artificial intelligence. According to budget analyses, the overall rate remains 30%, but the refundable portion gradually decreases in favor of the non-refundable portion starting in 2026, and assistance is reduced for certain development work done for markets located exclusively outside Quebec. Have the exact impact on your eligible payroll checked.

4. Direct contributions

Program	What it's for	Key amounts and conditions
NRC IRAP	SME technology innovation projects, with an Industrial Technology Advisor	Non-repayable contributions depending on the project; SMEs with 500 employees or fewer (NRC)
CanExport SMEs	Developing new export markets	$10,000 to $50,000 per project, covering up to 50% of eligible expenses (2026-2027 guide)
Mitacs	Research internships with graduate students	Costs shared with the company, depending on the program
Investissement Québec programs	Investment, innovation and export projects	Loans, guarantees and contributions under the programs in effect

For CanExport, check the eligible markets and application dates for the current year: conditions can vary from one intake to the next.

5. Public and quasi-public financing

• BDC: loans for technology companies, growth financing, and BDC Capital for venture capital.
• EDC (Export Development Canada): credit insurance, guarantees and financing for exporting companies.
• Investissement Québec: loans, equity investments and advisory support, including for international expansion.

These partners complement a venture capital raise well. For fundraising strategy itself, read our article on seed and Series A fundraising in Canada and the United States.

Summary: which program for which need?

Need	Programs to look at first
Funding core R&D	SR&ED, CRIC
Funding software developer and AI salaries	Reformed CDAE, SR&ED, CRIC
Funding a specific innovation project	NRC IRAP, Investissement Québec
Funding exports (United States, Europe)	CanExport SMEs, EDC, Investissement Québec
Hiring research talent	Mitacs
Covering working capital needs	BDC, Investissement Québec

Common mistakes in applications

• Documenting after the fact: reconstructing R&D at year-end weakens the claim if it's reviewed.
• Confusing routine development with technological uncertainty: SR&ED requires an uncertainty that available knowledge can't resolve.
• Overlooking how programs interact: a grant you receive can reduce the expenditures eligible for a tax credit.
• Restructuring without tax analysis: a Delaware flip, a foreign majority investor coming in or a merger can change your status and your rates.
• Missing application windows: some programs run through calls for proposals or limited intake periods.
• Underestimating payment timelines: refunds often arrive several months after fiscal year-end.

A typical annual calendar

Time of year	Action
Start of the fiscal year	Plan R&D and export projects, choose the programs to target
Ongoing	Document the work, track timesheets and expenses
Based on calls for proposals	Submit contribution applications (NRC IRAP, CanExport SMEs, provincial programs)
Fiscal year-end	Prepare SR&ED, CRIC and CDAE claims with your tax advisor
After filing	Track refunds and respond to any requests from the CRA or Revenu Québec

Checklist to maximize your non-dilutive funding

• Check your tax status (CCPC or not) before any restructuring
• Document R&D as you go (hypotheses, tests, results, timesheets)
• Map your 2026 projects and match them to the relevant programs
• Coordinate federal and Quebec claims to avoid double counting
• Put application deadlines (CanExport, IRAP) in your annual calendar
• Plan your cash flow: refundable credits arrive after your tax returns are filed
• Have your claims reviewed by a specialized tax advisor

How SFB Consultants can help

Non-dilutive funding should support a strategy, not replace it. Sandra D'Orazio helps leaders align their growth and expansion plans with the available programs, working alongside their tax advisors and other advisors. Learn more about our startup growth and international expansion services.

Want to know which programs apply to your 2026-2027 plan? Book a 30-minute discovery call with Sandra to review your projects and funding priorities.