What is CRA’s look-through approach and how is it applied to remuneration claimed for OIDMTC?
The CRA’s look-through approach limits the amount of remuneration that may qualify as a labour expenditure to the amount that would have been incurred by the qualified corporation had it directly employed the individuals. This approach is used when remuneration is paid to a self-employed individual, a taxable Canadian Ontario based corporation, or a partnership carrying on a business in Ontario for the services of its employee(s). In applying this approach, the qualifying corporation must get from the service provider the amount of salary or wages paid to the employee. This amount should qualify as a qualifying remuneration amount for the development of eligible products claimed under the OIDMTC.