One of the most common questions we get when we first start working with customers is How should I be tracking my tax credit eligibility?
Or, for our Canadian partners: How do I keep track of my SR&ED?
It’s a fair question—after all, maximizing tax credits is probably one of the reasons you chose Boast. But it’s not the main thing we want you to focus on.
That’s because we know your time is valuable—and that goes for your development teams, too. Figuring out which of your projects or activities qualify for R&D tax credits or government grants is simply not something you should have to worry about.
Because that’s our job.
As a company, your priority should be driving innovation and building new solutions. Your tax credit eligibility will follow naturally from that focus, but it should never be the main reason behind your R&D strategy.
While your team is busy innovating, Boast AI keeps an eye on your tax credit eligibility by connecting directly to the project tracking tools your R&D team already uses. This lets your developers stay focused on their work, while our platform and tax experts work in the background to maximize your claim.
For any of this to work—including keeping your developers aligned and your costs under control—you need to document your activities and track your workflows. If you don’t, the consequences can go far beyond just missing out on tax credits or grants.
Project tracking is key to optimizing R&D
Both the IRS in the US and the CRA in Canada recommend that any business applying for innovation funding should be tracking their workflows—like timesheets and project plans—as a basic requirement. These agencies see this as a business best practice, and following it shows them you’re doing your due diligence across your product team. This can boost their confidence in your company—whether it’s officials or auditors reviewing your claim.
Ideally, your team would track every minute spent on R&D and product development. But we know that’s not always realistic—especially for early-stage companies that may not formally track every ad-hoc activity that contributes to R&D.
So while tracking 100 percent of time is the gold standard, any documentation that links activities to costs and outcomes will help—not just for your claims, but also for managing and optimizing your product roadmap and strategy.
It’s worth repeating: accurate time tracking isn’t just about funding. It’s the best way to improve your operations and make better decisions as you grow.
This applies to both activities that are clearly tax credit-eligible and any non-creditable time. The key is that your team doesn’t need to decide what’s eligible.
The best thing your developers can do to help the R&D and SR&ED tax experts at Boast AI is to consistently collect documentation—from the routine to the groundbreaking—and let us build the story for your claim.
Key Documentation for Project Tracking
Here’s the kind of documentation your teams should aim to collect:
- Records of technical challenges – Log all technical challenges faced during development. Include details on experiments, prototypes, iterations, testing, and analysis of test results.
- Version control for all technical documents – Track changes in architecture documents, design documents, and source code to show how the system evolved.
- Software prototypes – Add notes on how prototypes were analyzed.
- Test documents – Save test cases, results, and analysis, including dates and who performed the testing.
- Developer Notebooks – Keep all handwritten developer notebooks (and make sure they’re dated).
- Meeting minutes – Include the date, attendees, meeting length, and a summary of any technical issues discussed.
- Whiteboard photos – Take pictures of software designs on whiteboards and save them with your project docs.
- Emails – Track email threads with labels when relevant technical challenges are discussed.
And maybe most important: Timesheets.
Ideally, everyone involved in R&D should track 100 percent of their time, whether it’s tax credit-eligible or not. This gives Boast AI the best data to accurately calculate your SR&ED and tax credit eligibility—especially when time tracking includes notes and documentation on activities and technical challenges.
But we know some time will slip through the cracks. That’s where thorough documentation becomes a real asset—it can help fill in the gaps and add context to your time records.
As a baseline, time tracking should be broken down by Project and Activity when teams are linking specific actions to outcomes. While these are broad categories, here are the Activities most relevant to a tax claim (see our infographic, Technology Readiness Levels, Explained to learn more about the activities expected at each R&D phase):
- Development
- Testing
- Technical Requirements
- Technical Analysis
- Technical Supervision
- Data Collection
- Non-SR&ED (for all other tasks not covered above)
Where you store all this information is another important factor. Depending on your company’s size and the scope of your R&D, your system could be as simple as an Excel spreadsheet or as robust as a third-party time tracking tool.
Examples of third-party tools include Jira, Toggl, and Harvest, just to name a few.
While Boast AI can integrate with whatever platform works best for your team, there are some criteria and Best Practices you should always follow, no matter which time tracking method you use.
Time tracking best practices
Step 1: Use your project management system’s natural hierarchy
Every system has a ‘natural hierarchy’ of information it asks you to track. Stick with it—the platform was designed that way for a reason.
By following the data structure your platform (like Jira) recommends, you’ll boost development velocity, transparency, and communication as your company grows—and you’ll give Boast AI the context we need to prepare your claim.
Most importantly, this hierarchy gives you the visibility to see who’s working on what and how your company is delivering new and innovative products.
Step 2: Assign story points to your sprints
If you use agile development, assigning story points to your sprints will help you plan and deliver on your goals—and it doubles as a time tracking tool for your R&D tax claim.
We recommend a simple 15-point-per-sprint agile approach. It gives your team accurate time estimates that will back up your claim if you’re ever audited.
Step 3: Use your code repository for version control
This step may seem obvious, but it’s crucial for substantiating your tax claim. Even just referencing your ticket number in your Git commit, for example, creates a clear trail that stands up to the toughest audit.
Step 4: Allocate story points
Your team should allocate story points to quality assurance, project management, and resource management to maximize your tax claim and reduce overhead. While these resources aren’t always tracked in platforms like Jira, creating a task for each sprint actually provides technical evidence for your claim.
Step 5: Data integration
Integrate all this data with Boast. AI to automate manual tasks (like time tracking, automatic categorization of service tickets and epics to the right projects, etc.)
After that, Boast AI takes care of the rest! Once your documentation and time tracking systems are set up, our team works alongside yours to monitor for any activities that could be claimed through R&D tax credits.
By combining our AI-powered platform with years of experience (many of us at Boast AI are founders ourselves), we help you maximize access to non-dilutive capital and extend your runway—with minimal effort. Want to learn more? Schedule a call with our team today.
