Do you speak Shredish? If you have submitted an SR&ED tax credit application to the CRA (Canada Revenue Agency), you better hope you do speak Shredish.
Shredish is a unique language, a dialect of sorts, understood by a small group of Canadians within the SR&ED Department of CRA, plus SR&ED professionals that work with SR&ED claimants, ie. SR&ED consultants and SR&ED Experts. It is estimated that fewer than 1000 Native Canadians speak Shredish.
For an introduction to Shredish, one can visit the glossary at the CRA website for an incomplete description of the vernacular. For an informal introduction, you may choose to speak to anyone who has attended an SR&ED audit of late.
If you only spoke English and didn’t speak Shredish, then you would clearly be at a disadvantage entering into such a forum.
Case and point. The average Canadian not familiar with Shredish would naively believe that “technical” and “technological” are relatively similar words with similar meanings. Not so! In Shredish, a passionate philosophical debate can break out amongst intellectuals over the difference between these two terms. Why? Well, because technological work may be eligible under the SR&ED program, but technical work is clearly ineligible. To speakers of Shredish, this is obvious.
Similarly, the importance of words like “systematic” and “standard” and “routine” cannot be underestimated.
To the SR&ED claimant, qualified in his or her area of science, technology, or medicine, it may be perplexing or even infuriating to find out that a government official determines that your work is not “systematic”, and you might wonder, what does that mean? It means the CRA auditor may interpret the project as an assembly of disassociated and random activities. The gall!
Did you know that “trial and error” has a special meaning in Shredish? It’s a synonym for “not eligible”.
There are many different ways to say “not eligible” in Shredish. For example: “routine”, “standard practice”, “quality control”, “style change”, “approximated”, “estimated”, “commercial”, “non-arms length”, “foreign”, “undocumented”, “in the public domain”, and “social science”, plus many more.
Since “not eligible” means “denied”, and “denied” means “we’re not sending you any money”, there is naturally a great deal of apprehension and anxiety surrounding these terms and the whole of the elusive dialect.
“Transformed” is another term, deceptively simplistic, but yet complex. It is used to refer to physical materials that have been transformed into something else that has a new commercial value and may be sold in the future.
“Specified” has a well-established meaning in English, but in Shredish it means “owner”. Who would have guessed that?
“Proxy” you would think has something to do with voting at a board meeting. Wrong again. “Proxy” means, “more money” in Shredish.
“Traditional” typically means “customary”, but in Shredish, a rare minority of approximately 1% of claims are classified as “traditional”. Check this box by accident, and you may be in for a world of pain.
My favorite Shredish word has always been “commensurate”, because “commensurate with the needs of….” generally leads to approval.
Those companies and department managers that stray into the world of SR&ED without the benefit of fluency in Shredish rarely relish the experience.
If you, or someone you love, are interested in the SR&ED program but do not have the time or inclination to study Shredish, we highly recommend a consultation with Bond Consulting Group, the SR&ED experts.