What is the difference between non-specified and specified products?
Non-specified products are developed by your company for sale or licence to one or more arm’s length parties who have not previously entered into an arrangement with your company for development of the product.
Specified products are developed by your company under the terms of an agreement between your company and an arm’s length purchaser corporation for sale or licence by that purchaser to one or more arm’s length parties. Specified products are essentially developed under a fee-for-service arrangement.
Non-specified products receive a higher OIDMTC rate of 40% on eligible expenditures, while specified products receive an OIDMTC rate of 35% on eligible expenditures.
PLEASE NOTE: whether it’s a non-specified or specified product, your company must demonstrate that they meet the 80/25 rule for the product.