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An Essential Financial Support: Subventions and Tax Credits for your CRM and ERP Implementation Project

Are you part of an enterprise that is hesitant facing the digital transformation? Is this resistance to jump into the digital adventure linked to your budget or your lack of knowledge? If this is the case, this blog will help you to start your own digital transformation. Even though there are a lot of types of subventions or programs to support you in your process, those presented here are very interesting.

We have targeted 2 programs to help you:

  • The subvention “SMB in action” (unofficial translation of PME en action) from the Ministry of Economy, Science and Innovation (M.E.S.I.)
  • The tax credit for the integration of IT in SMB from Investment Quebec

Before writing this blog, we not only looked at information on their website, but we also spoke with the ministry to make sure we understand the process of these programs. It is important to note that you can benefit from both programs. You don’t have to choose, but you do have to make sure you can qualify.

In this article, you will get:

  • An overview of the 2 programs
  • A description of the eligibility criteria
  • Information on the subscription process

SMB in action of the Ministry of Economy, Science and Innovation (M.E.S.I.)

(source : M.E.S.I. – PME en action )


Overview of the offer

This program is designed to increase the productivity level of Quebec enterprises and to enhance competitiveness and speed the growth of enterprises. The M.E.S.I. is an institution which exists to help businesses grow and evolve following the rhythm of the market. So, before officially starting your project, we recommend you call them. They will be able to act as a guide for you and your company to help you prepare for your digital transformation.

Admission criteria to the SMB in action subvention

The program is for non-profit corporations with facilities in Quebec, including the coop and the social economy enterprise with commercial activities in any of the following industries:

  • Manufacturing
  • Propulsive service sector, which include the enterprise with a high added value contributing in an important way to the production of goods or using new technologies. The targeted enterprises are generally actives in the following sectors:
  • Information and communication technology
  • Environmental services
  • Industrial creation and design services
  • Industrial labs and scientifically services
  • Private research services
  • Distribution center with an added value

The other activity sectors and state-owned enterprises are excluded. A priority is given to the enterprises that qualify for the Stratégie Performe.

Eligible projects to the SMB in action subvention

The realization of projects linked to the execution of precise actions for the intervention plan as it is mutually agreed between the enterprise and the Ministry.

These projects aim for the implementation of business practices that allow important productivity gains for the enterprise. Some eligible projects are:

Non-eligible projects to the SMB in action subvention

  • Activities linked to a human resource function
  • Activities aiming for the development of markets
  • Activities for which the period of accomplishment is continuous or exceeds 12 months

Eligible expenses

The financial help offered to the enterprise takes the form of a non-refundable contribution that can reach 40% of the eligible expenses for the project, to a maximum of $50,000 per project.

The total rate of governmental financial help for a project cannot exceed 50% of total expenses for the project.

The expenses linked to the app or software licenses fees are not eligible to the subvention, only the implementation service fees are covered by this one.

To apply for it

To get more information or to start a well-informed process, please call the regional manager of your district. Each district has a dedicated team from the M.E.S.I.

Subscription process to the SMB in action subvention

So, if we had to explain the process to subscribe to this subvention:

  1. Contact the regional manager of your district.
  2. The M.E.S.I. agent will validate your enterprise’s eligibility (according to the number of demands, the E.S.I. expect a delay of 20 business days to validate your eligibility to the subvention).
  3. If your enterprise is eligible for the MEI subvention, the MEI they will assist you throughout the process and to contact a partner like Gestisoft to start the analysis and realization process.
  4. If you or the MEI agent wishes to meet us, ask us here and an advisor that knows the program SMB in action will contact you.
  5. Once you have found your partner and you have agreed on a project, the implementation can begin.

Tax credit for the integration of IT in the SMBs (Investment Quebec)

(Source : Investissement Quebec -Tax Credit for the Integration of IT in SMBs)

Overview of the tax credit for the integration of IT in the SMBs

This fiscal measure’s goal is the boost the integration of IT had in the business processes in the Quebec SMBs. It allows the admissible enterprises to get a refundable tax credit.

End of the subvention: the negotiation of the admissible IT integration contract must start before January 1, 2020.

4 characteristics essential for the fiscal help:

  • It is a refundable tax credit equal to 20% of the admissible expenses linked to the contract for integration admissible IT.
  • The total amount of this credit is limited to $50,000 for the duration of the credit application.
  • However, the credit rate is reduced in a linear way when the capital that has been deposited from the associated societies is greater than $35 million, or less than $50 million.
  • The society cannot benefit from this tax credit if the capital deposited is $50 million or more.

The admission criteria

Is admissible in a society (or a society of persons that it is member of) that:

  • Has an establishment in the province of Quebec
  • The activities are majorly (more than 50%) realized in one of the following admissible activity sectors:
  • Primary sector (Scian 11-21)
  • Manufacturing sector (Scian 31-33)
  • Wholesale (Scian 41)
  • Retail (Scian 44-45)

Conduct a diagnostic before beginning

The contract has to be linked to a preliminary analysis, realized by the society or society of persons, or its account. It will establish a plan that will describe its needs to have access to a computing structure that will allow the usage of a management software package to optimize the business process.

Arm’s length Subcontractors

The contract for the integration of IT has to be conclude with a person having no link of dependency with the society or society of persons. This subcontractor must agree, as stipulated in the contract, to provide the admissible management software package.

Providing an admissible management software package

Providing an admissible management software package means one or more following activities:

The sale or lease of a management software package or a free management software or a license that allows management of one or many following elements:

  • The setting of operational processes of an enterprise by integrating a set of enterprise functions [Enterprise Resource Planning ERP]
  • The interactions of an enterprise with its clients which requires multiple and interconnected communication channels [Customer Relationship Management CRM]
  • A network of enterprises involved in the production of a product or a service required by the final client to cover the movements of materials and information, from the point of origin to the consumption point [SCM]
  • The provision of services linked to the development, integration (implementation), reconfiguration and evolution of the previously described software
  • The provision of services required to accompany and train the employees of the enterprise and to fix problems linked to the integration of the previously described software in the enterprise
  • The sale or lease of universal electronic material of data treatment and of the exploitation software, including the accessory material for data treatment and the app software required in the integration of the previously described management software package in the enterprise, or the licenses of such goods

Subscription process

Contact Investment Quebec to ask for an analysis of your application. A fee of $631 is applied for the evaluation of your eligibility. In short, this analysis will determine if your enterprise is eligible to the tax credit. Plan for a delay of 3 months for your file to be evaluated.

For the complete process of the tax credit, you can download the following pdf.

To fill the application, you can download the Excel sheet here.

To conclude, we have shown those two different types of help because they are complementary and very useful. Remember that SMB in action subvents the service fees of the implementation of a solution and that the tax credit from Investment Quebec can be used for the management software package and its license fees. Have any other questions? Contact one of our experts! And don’t forget that those credits and subventions are an undeniable asset for the optimization of your business.

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