This quantified comparison of tax incentive financing by FINALTA CAPITAL versus that of financial and government institutions is based on the following observed data and hypotheses (note that certain situations may entail terms different to those presented).

The table below compares loan disbursement schedules and their respective impact on the amounts paid out over time:

FINALTA CAPITAL Financial and government institutions1
Financing percentage The financing percentage is usually from 75% to 85%, and up to 100%, for SR&ED tax credits, from 85% to 95%, and up to 100%, for e-business, multimedia and other tax credits and from 75% to 85%, and up to 100%, for government grants. 75% of the requested tax incentive. Terms may vary.
Number of disbursements 4 disbursements each representing 25% of the loan amount. 5 disbursements each representing 20% of the loan amount.
Disbursement frequency On the first day of each quarter of the fiscal year, in anticipation of eligible expenditures. Following production of quarterly financial statements2 once eligible expenditures have been executed.
Holdback No holdback or reserve. 20% of the authorized loan amount is usually withheld until the tax incentive application has been filed, i.e. 4 to 6 months after the end of the fiscal year.3
Release of full loan 100% of the loan amount is disbursed by the first day of the fourth quarter, i.e. before the end of the fiscal year. 100% of the loan amount is disbursed after the tax incentive application has been filed, i.e. from 4 to 6 months after the end of the fiscal year.

To calculate the average outstanding loan balance, the comparison assumes that:
1) Borrowers apply for tax incentives on average three months after the end of the fiscal year.
2) Tax incentive refunds occur on average: (i) two months after applying to the Canada Revenue Agency for federal SR&ED tax credits; and (ii) four months after applying provincial tax authorities for provincial SR&ED, e-business, multimedia or other tax credits.


1 The comparison is based on publicly available information along with our understanding of the loan terms offered by financial and governmental institutions.

2 The comparison assumes a 30-day period for producing quarterly financial statements and receiving the related loan disbursement. As a result, loan instalments from financial and government institutions are disbursed approximately four months later than those from FINALTA CAPITAL.

3 The total amount of a financial institution or government loan is received approximately 7 to 9 months later than with FINALTA CAPITAL.