Key takeaway: The SR&ED Quebec tax credit is delivered through the CRIC (Credit for Research, Innovation and Commercialization): 30% refundable on the first $1 million of eligible expenses above an exclusion threshold, and 20% refundable on the excess. The "65% combined" you'll see quoted everywhere adds the federal 35% on top as if the two were independent. They aren't. The CRA treats provincial credits as government assistance that reduces your federal base, so the real first-tier combined rate is about 54.5%, and about 48% above the $1 million mark. That is still the richest provincial rate of Canada's major R&D provinces. Model the 54.5%, not the 65%.
Montreal is home to one of the world's most concentrated AI research clusters, and Quebec City and Sherbrooke have their own growing tech corridors. All of that R&D activity sits on the same federal SR&ED program every other province does. The provincial layer on top is the CRIC, a single refundable credit that applies for tax years beginning after March 25, 2025, and its two-tier rate structure works differently from anything else in the country.
Here's what the SR&ED Quebec tax credit actually pays, how the CRIC's tiers work, why the 65% number quoted almost everywhere overstates what you'll actually receive, and a worked example so the math is concrete rather than a headline percentage.
What is Quebec's CRIC?
For tax years beginning after March 25, 2025, Quebec's R&D credit is the Credit for Research, Innovation and Commercialization (CRIC), a single refundable credit with two rate tiers:
- 30% on the first $1 million of eligible expenses above an exclusion threshold.
- 20% on eligible expenses above that $1 million.
We keep a running summary of the current rates and rules on our Quebec SR&ED page; what follows is the full mechanics.
The exclusion threshold itself is not a flat number: it's the greater of $50,000 or the sum of Quebec's basic personal amount per R&D employee, and each employee's amount is adjusted to reflect the time they actually spend on eligible activities. A researcher splitting their year between eligible R&D and product support contributes a pro-rated share of the basic personal amount, not the full figure. So the threshold scales with how much of your team's time goes into the eligible work: a small team sits close to the $50,000 floor, while a larger R&D group has a higher threshold before the credit starts applying. The practical effect is the opposite of an expenditure limit. Instead of a ceiling on how much spend qualifies, Quebec sets a floor below which nothing qualifies, then pays a rich rate above it.
One more structural feature worth knowing: the CRIC covers a narrow, defined add-on category of pre-commercialization activities, specifically regulatory testing and certification, and product design. These must be undertaken in conjunction with R&D carried out in Quebec. They're an extension bolted onto an eligible R&D claim, not a broader eligibility test, and Quebec's own CRIC page is the authority on exactly which activities fall inside the category.
How the federal and Quebec credits actually combine
The federal side is the enhanced 35% refundable investment tax credit, available to CCPCs on qualifying expenditures up to $6 million per year, per Bill C-15, which received royal assent March 26, 2026.
Add the CRIC's 30% first tier, and the arithmetic everyone reaches for is 35 plus 30 equals 65. That number is all over the coverage of the CRIC, and it's wrong. Under the CRA's Assistance and Contract Payments Policy, provincial R&D tax credits are government assistance, and government assistance reduces your qualified SR&ED expenditures for the federal credit under section 127(18) of the Income Tax Act. That applies whether the provincial credit is refundable or non-refundable. Quebec's 30% doesn't sit beside the federal 35%. It comes off the federal base first.
So the honest first-tier math on a common base looks like this: the CRIC pays 30%, and the federal 35% then applies to the remaining 70%. That's 30% plus 24.5%, or about 54.5% combined. On a full $1 million above the threshold, that's $300,000 from Quebec plus $245,000 federal, $545,000 in total rather than the $650,000 an additive sum promises. Past the first $1 million the CRIC drops to 20%, the federal 35% applies to the remaining 80%, and the combined rate on that tranche is about 48%.
There's a second boundary worth tracking. The federal enhanced rate tops out at the $6 million expenditure limit. A company spending well past that sees its federal contribution flatten to the basic 15% rate on the excess. Quebec's 20% second tier keeps applying per the CRIC's stated structure, so the blended rate keeps sliding as spend grows.
Treat every figure here as illustrative rather than a quote. The exact interaction depends on your expenditure mix, on base differences between what the CRIC counts as an eligible expense and what the federal SR&ED rules count, and on how overhead is treated under the proxy method. But the direction is not in doubt: the CRA's policy is explicit that provincial credits reduce the federal base, so any source quoting a flat 65% is skipping a step the CRA doesn't skip.
And 54.5% is still the number to beat. Even after the grind, Quebec's first tier pays the highest provincial rate of Canada's major R&D provinces. BC's combination works out to about 41.5% and Ontario's to about 40.2% on the same corrected basis. The correction changes the number, not the ranking.
Who qualifies for the SR&ED Quebec tax credit
The federal eligibility bar applies everywhere in Canada: work that advances scientific knowledge or resolves technological uncertainty, carried out through systematic investigation, across the CRA's eight support-work categories. Every Quebec claimant needs to clear that bar.
Quebec doesn't run a separate scientific test on top of it. Per Quebec's CRIC page, Quebec's R&D definition is harmonized with federal legislation, and the CRA carries out the scientific review of the R&D work. If your project clears the federal eligibility bar, you are not facing a second, different eligibility argument on the science at the provincial level. What the CRIC adds is the narrow pre-commercialization category described above: regulatory testing and certification, and product design, claimable only in conjunction with Quebec R&D.
On geography, Quebec is the odd one out in a useful way. The CRIC is administered by Revenu Québec under Quebec's own rules, and the CRA's Assistance and Contract Payments Policy lists Quebec as the exception to the usual requirement of a permanent establishment in the province where the R&D is performed. If your team is split across provinces, check Quebec's own rules for how expenses are allocated to the CRIC rather than assuming the federal treatment carries over.
A worked example
Because the CRIC's exclusion threshold depends on your specific R&D headcount and time allocation, the cleanest way to see the math is to work in terms of spend above that threshold, whatever it happens to be for your team. The order of operations matters: the CRIC is calculated first, then the federal credit applies to what's left.
Say a Quebec CCPC has $2 million in eligible R&D expenses above its exclusion threshold for the year:
- CRIC, first $1 million at 30%: $300,000, refundable.
- CRIC, next $1 million at 20%: $200,000, refundable. Provincial total: $500,000.
- Federal qualified expenditures after the CRIC: $2 million less $500,000, so $1.5 million.
- Federal enhanced ITC, 35% of $1.5 million: $525,000, refundable.
- Combined: $1,025,000, or about a 51% blended rate on the $2 million.
Notice what happened to the headline numbers. The first tranche earned about 54.5%, the second about 48%, and the blend landed at roughly 51%. Nothing in that calculation touched 65%.
That's an illustration, not a quote. The real interaction depends on your expenditure mix and on base differences between the CRIC and the federal definitions, and the prescribed proxy amount adds 55% of your salary base as a standardized overhead allowance on the federal side if you use the proxy method, which enlarges the federal base before the credit applies. Glauq's calculator is a faster way to model your specific numbers, including where your team's exclusion threshold actually falls, than working through the tiers by hand.
How Quebec compares to other provinces
Quebec's CRIC pays the highest marginal provincial rate of Canada's major R&D provinces, and it's worth being precise about why rather than repeating the 65% headline without context.
- Ontario's OITC pays 8%, refundable, roughly 40.2% combined once the OITC reduces the federal base, and only on the first $3 million of eligible expenditures, a fixed cap that didn't move when the federal limit doubled. Full breakdown here.
- British Columbia offers a 10% refundable credit, about 41.5% combined after the grind. A lower rate than Quebec's first tier, but BC's limit tracks the full federal $6 million ceiling with no second, lower tier. We've run the same honest math for BC.
- Alberta's Innovation Employment Grant pays 8% up to a base spend level and 20% above it, up to $4 million in annual R&D spend, structured as a grant layered on the federal credit rather than a stacked tax credit.
- NWT, Nunavut, and PEI have no provincial R&D credit at all, per the CRA's own provincial credits summary.
Every combined figure above already reflects the federal grind. Each province's credit reduces federal qualified expenditures the same way Quebec's does, so no province's real combined rate is the sum of its headline rates. Comparing provinces on naive sums gets the ranking roughly right and every actual number wrong.
Quebec's rate advantage is real, and for an early-stage company with eligible spend concentrated in that first $1 million above the exclusion threshold, it's a genuinely different outcome than claiming from most other provinces. It's not, on its own, a reason to relocate a team. Quebec's exclusion threshold means very small claims may see less of a benefit than the headline rate suggests, and talent, cost of living, and existing operations usually matter more than a provincial tax rate when deciding where to build.
Filing: what's different at the provincial level
The federal and Quebec credits are filed separately, on different forms, to different authorities.
- Federal claim: Form T661 plus Schedule T2SCH31, filed with your T2 corporate return, due 18 months after your fiscal year end, the same hard deadline with no extensions that applies everywhere in Canada.
- Quebec claim: the CRIC is claimed on Form RD-1029.8.CR-T, filed with your Quebec corporate tax return to Revenu Québec, separate from the federal T661.
Both filings need to be complete and on time to capture the full combined benefit. A federal claim filed correctly with no corresponding Quebec form still gets you the federal credit, but leaves the CRIC unclaimed. That's refundable cash at the richest provincial rate among Canada's major R&D provinces, and it doesn't file itself.
How the 2026 federal changes affect Quebec claimants
The CRIC's rates and exclusion threshold are provincial and unaffected by federal legislation, but the size of what they combine with changed materially. Per Bill C-15:
- The federal expenditure limit doubled to $6 million, so Quebec CCPCs earn the federal 35% on twice as much spend as before. The grind still applies: the 35% is calculated on qualified expenditures after the CRIC reduction.
- The taxable-capital phase-out range moved to $15 million–$75 million federally, letting growing Quebec companies keep the federal enhanced rate longer.
- Capital expenditures incurred after December 15, 2024 are eligible again federally, with the 35% credit on those capital costs 40% refundable.
- Eligible Canadian public corporations can now earn the enhanced refundable rate too, if listed on a designated exchange, resident in Canada, and not controlled by non-residents.
For a scaling Quebec company, the practical effect is that the federal side of the claim can now grow well past where it used to cap out, while the CRIC's own two-tier structure keeps applying exactly as before.
Where pre-claim approval fits for a growing Quebec claim
As of April 1, 2026, the CRA offers an optional pre-claim approval process, applied for through My Business Account before the work begins. It's a federal program, not a Quebec one, but it matters more in Quebec than you might expect. Because Quebec's R&D definition is harmonized with the federal one and the CRA carries out the scientific review, a federal pre-approval settles the science question that both sides of your claim rest on. The pre-commercialization add-on is still assessed under Quebec's own rules, but the core R&D eligibility is one question, not two.
The program is open to CCPCs, other Canadian corporations, and partnerships with gross business income under $25 million, in good standing, on projects not previously claimed or under litigation, for up to 3 projects with a determination in 8 weeks and approval holding for up to 3 years. Claims made up only of pre-approved projects get an accelerated, expenditures-only review: 90 days instead of the standard 180. None of this changes your 18-month filing deadline or the mechanics of the CRIC.
Software is where most Quebec claims already are
Quebec's tech and AI sector skews heavily toward software, which lines up with the national picture: software development accounted for 42.6% of the investment tax credits allowed nationally in FY2025-26, the single largest category by a wide margin. If your Quebec company builds software and assumed SR&ED mainly rewards lab-based or hardware research, that assumption is backwards. More of what your engineering team does likely qualifies than you'd guess, and the CRIC applies to software R&D salary costs the same way it applies to any other eligible expense.
That same CRA dataset shows 90% of claims nationally were accepted as filed with no review in FY2025-26, and refundable claims accepted as filed were processed within 60 calendar days 95% of the time, under the program's service standards. Those figures describe the CRA's federal review, not Revenu Québec's own processing of the CRIC; the two are assessed on separate returns and separate timelines. A claim that does get selected for federal review is worth preparing for regardless of province, and what a CRA SR&ED review actually looks at is worth reading before you're in one.
A two-tier rate, a scaling exclusion threshold, and a federal base that shrinks by the amount of your provincial credit make Quebec's claim math more layered than a flat-rate province's. Getting the tier boundaries and the grind right depends on records that were accurate when the work was done, not reconstructed at filing time. That's the specific problem Glauq is built to solve for you: your technical narrative is assembled continuously from the tools your team already uses, and a qualified, independent SR&ED expert reviews every claim before it's filed and stands behind it if the CRA has questions. You pay a flat fee rather than a percentage of the refund, so a richer Quebec claim doesn't come with a proportionally richer bill.
Frequently asked questions
What is the SR&ED Quebec tax credit rate? Quebec delivers its R&D credit through the CRIC: 30% refundable on the first $1 million of eligible expenses above an exclusion threshold, and 20% refundable above that. Combined with the federal enhanced 35% rate, the effective first-tier total is about 54.5%, because the CRIC reduces your federal qualified expenditures before the 35% applies.
Is 65% the actual combined rate for Quebec SR&ED? No. The 65% figure adds 35% and 30% as if they applied to independent bases. Under the CRA's assistance rules, provincial credits are government assistance that reduces federal qualified expenditures under section 127(18) of the Income Tax Act. The illustrative first-tier combined rate is about 54.5%: $300,000 from Quebec plus $245,000 federal on $1 million, not $650,000. Above the first tier it's about 48%, and a $2 million claim above the threshold blends to roughly 51%.
What is the exclusion threshold, and how is it calculated? It's the greater of $50,000 or the sum of Quebec's basic personal amount per R&D employee, per Quebec's CRIC page, with each employee's amount adjusted to reflect the time they spend on eligible activities. It scales with your R&D headcount and time allocation rather than being a single fixed number.
Can I claim both the CRIC and the federal SR&ED credit? Yes, and you should. The CRIC is filed on Form RD-1029.8.CR-T with your Quebec corporate tax return to Revenu Québec, separate from your federal T661 and Schedule T2SCH31. Just don't model the two as additive: the CRIC amount comes off your federal qualified expenditures before the federal 35% is calculated.
Does the CRIC use the same eligibility test as federal SR&ED? On the science, yes. Quebec's R&D definition is harmonized with federal legislation, and the CRA carries out the scientific review of the R&D work, per Quebec's CRIC page. The CRIC adds one narrow category on top: pre-commercialization activities (regulatory testing and certification, and product design) that must be undertaken in conjunction with Quebec R&D.
Is Quebec's SR&ED credit the most generous in Canada? Among Canada's major R&D provinces, yes on the first tier: about 54.5% combined, against roughly 41.5% in BC and 40.2% in Ontario on the same corrected basis. Above the first $1 million the combined rate drops to about 48%, so on very large claims the gap with a flat-rate province like British Columbia narrows.
The CRIC's two-tier structure, the scaling exclusion threshold, and the federal grind mean the 65% you'll see quoted is not the number your claim pays. Roughly 54.5% on the first tier is, and that's still the best provincial rate going. Knowing where your spend actually falls relative to the threshold and the $1 million boundary is the difference between an accurate claim estimate and an optimistic one.
See what your Quebec SR&ED claim could be worth — estimate your combined federal and CRIC refund, read the full 2026 SR&ED guide, or check your eligibility.