NRC IRAP — Canadian SMEs
NRC IRAP for AI projects, delivered by a Canadian subcontractor your ITA will recognise.
IRAP is the federal government's non-repayable R&D contribution program for Canadian SMEs — $75K–$200K typical for first-time projects, up to $10M for advanced ones, with the new $100M AI Assist sub-stream specifically for AI work. We've been shipping production AI systems for SMEs for years; on an IRAP project, we slot in as your eligible subcontractor and your ITA gets a delivery partner they can defend at contribution-agreement signing.
What NRC IRAP actually is
The NRC Industrial Research Assistance Program is Canada's longest-running R&D support program for SMEs, run by the National Research Council. It does two things at once: it provides non-repayable contribution funding (not a loan, not a tax credit), and it pairs every project with a dedicated Industrial Technology Advisor (ITA) who scopes the work, vouches for it inside NRC, and stays involved through delivery.
The ITA layer is the part most SMEs misread. IRAP is not a portal where you submit a form and wait. It is a relationship-led program — you get assigned to an ITA in your region, that ITA decides whether your project is genuine R&D, and the contribution agreement only exists because your ITA has stood behind it internally. This is a feature, not a bug. It is also the reason IRAP has a higher conversion rate from first contact to disbursement than most other federal programs — the ITA filters in advance.
For AI work specifically, Budget 2024 added a $100M over five years envelope called AI Assist, which runs inside IRAP using the same ITA model. AI Assist is not a separate program with its own portal — it is a budget allocation that lets ITAs say yes to more AI projects without that allocation eating into the broader IRAP pool. From the SME's side, the application looks identical.
Source: NRC IRAP program page. AI Assist sub-stream announced in Budget 2024; active through to the planned 2026-27 transition into the Canada Innovation Corporation.
Who qualifies for NRC IRAP
IRAP has three hard gates and then a softer test that the ITA applies during scoping. The hard gates are crisp; the soft test is where most rescoping happens.
Incorporated, Canadian, ≤500 FTEs
- Incorporated in Canada (federally or provincially)
- For-profit (not-for-profits and Crown corps are excluded)
- 500 or fewer full-time-equivalent employees
- Operating in Canada with the capacity to deliver the R&D
- No minimum revenue floor — pre-revenue startups can qualify if the R&D is credible
Genuine technology-driven R&D
- Technical challenge with an uncertain outcome
- Requires experimentation, not just implementation
- Has a credible commercial path on the other side
- You have (or can hire) the technical capacity to do the work
- Not pure SaaS adoption with no novel build
Funding shape — what you can actually get
IRAP contributions reimburse a percentage of your technical labour (engineers, researchers, technical PMs working on the R&D scope) and eligible subcontractor invoices (a Canadian integrator like Creatrixe doing the AI implementation work that the R&D scope requires). The exact percentage — usually 60% to 80% — is set in your contribution agreement and depends on the project, your ITA's read, and your stage as a company.
Project sizes range across a wide band. First-time IRAP projects are typically $75K–$200K, sized to let an SME prove out the R&D and the IRAP relationship simultaneously. Returning, advanced projects can scale up to roughly $10M, with the contribution agreement structured against milestones — you spend, you submit, you get reimbursed against the agreed percentage.
The contribution is non-repayable as long as the project is completed substantially as agreed. There is no equity dilution, no interest, no clawback for commercial success. That is what makes IRAP structurally different from any loan program — including BDC LIFT — and why it sits alongside (not against) those other instruments.
The AI Assist sub-stream — $100M over five years
Budget 2024 carved out $100M / 5 years inside IRAP specifically for AI work. The framing in federal communications is that this addresses a known gap: SMEs adopting and developing AI need IRAP's mechanics (non-repayable, ITA-led, subcontractor-eligible) but the demand for AI projects was outpacing the general IRAP envelope and crowding out other R&D.
What AI Assist looks like in practice:
- Same intake process — your regional ITA still scopes the project. There is no separate AI Assist portal.
- Same contribution mechanics — 60–80% reimbursement on technical labour and subcontractor invoices, milestone-based.
- Same eligibility — incorporated, Canadian, ≤500 FTEs.
- Broader project framing — the AI Assist budget gives ITAs room to approve projects that combine AI development with substantial integration / data engineering / domain-specific model adaptation, not just pure novel ML research.
- Active through transition — AI Assist is currently funded and will move into the Canada Innovation Corporation with the rest of IRAP by 2026-27.
For Canadian SMEs whose AI projects sit in the gray zone between "adoption" and "research" — for example, building a retrieval system over a proprietary corpus, or training a domain-specific model on call-centre transcripts — AI Assist is often the right pocket. Your ITA can tell you within a scoping conversation whether the project lands inside it.
How Creatrixe fits — subcontractor on your IRAP project
This is the part to be honest about. Creatrixe is not an IRAP advisor. We don't run the ITA relationship for you, we don't write your contribution agreement, and we don't sign things on NRC's behalf. What we are is the eligible subcontractor on the technical side of your IRAP-funded AI work.
The pattern looks like this:
You contact your regional ITA
NRC assigns ITAs by region. Once you make first contact (through the NRC IRAP page or by phone), an ITA is allocated to your file. This part is between you and NRC — we don't insert ourselves. We will, however, help you prepare a one-pager describing the technical scope so the ITA conversation is efficient from minute one.
ITA scoping — technical R&D plan
Your ITA scopes the project with you — what's the technical uncertainty, what does success look like, what's the budget, who's doing the work. If Creatrixe is doing the AI implementation, this is where you name us as the subcontractor on the technical side. The ITA needs to see that the subcontractor is credible and Canadian; we'll provide the references and the engagement model documentation that supports that.
Contribution agreement signed
NRC issues a contribution agreement that specifies the project milestones, the eligible cost categories, and the reimbursement percentage. Subcontractor invoices (ours) get listed as an eligible cost. You sign with NRC; we sign a project SOW with you. The two agreements lock together.
Build and claim against milestones
We deliver the AI work — model integration, retrieval systems, agent design, deployment, measurement. As we invoice you, you submit claims to NRC against the contribution agreement and get reimbursed at the agreed percentage. The ITA stays involved across milestones; expect a check-in every 4–8 weeks. We supply the technical reporting your ITA needs.
Project closeout and follow-on options
At the end of the project, you and the ITA close out the agreement. This is also where you decide whether to scope a follow-on IRAP project (returning applicants often get larger envelopes), apply SR&ED against the technical labour you spent (tax credit on top of the IRAP contribution), or move the productionised system onto BDC LIFT for scale-out funding.
The honest framing: we are the implementation half of an IRAP-funded AI project. The ITA and your internal R&D leadership are the rest. The reason this works is that we have been shipping AI systems for Canadian SMEs for years — food service, content syndication, domain-specific assistants — so when an ITA reviews the subcontractor section of your application, the references hold up.
IRAP vs. BDC LIFT — different instruments, same buyer
Most SMEs we talk to about IRAP also know about BDC LIFT, and the first question is which one fits. The honest answer is usually both, at different stages. They are structurally different products solving structurally different problems for the same Canadian SME.
| Dimension | NRC IRAP | BDC LIFT |
|---|---|---|
| Instrument | Non-repayable contribution (grant-like) | Loan — typically 2.25% preferential rate |
| Funds | R&D — uncertain outcomes, experimentation | Adoption — implementing known AI patterns |
| Size (typical) | $75K–$200K first time; up to $10M advanced | $25K–$2M AI-only; up to $5M with equipment |
| Reimbursement | 60–80% of eligible labour + subcontractor cost | Full loan disbursement; repayment over term |
| Floor | No revenue minimum; must be incorporated | $1M+ revenue (Track A); $5M+ for Track B |
| Advisory | ITA-led, mandatory and substantive | BDC Advisory plan, mandatory |
| Decision | Relationship-based — ITA's recommendation | Underwriting — credit and project review |
| Best for | Novel build with technical uncertainty | Production deployment of known patterns |
The stack pattern: SMEs run an IRAP-funded R&D project to build something novel (custom model adaptation, integration architecture, domain-specific agent design), then use a BDC LIFT loan to fund the broader deployment that productionises that R&D output across the business. The Creatrixe role looks slightly different in each — subcontractor on the IRAP side, system integrator on the LIFT side — but the engineering team is the same.
Working with your Industrial Technology Advisor
The ITA is the single most important relationship in the IRAP process. Some patterns we've seen across multiple SME-ITA relationships:
- ITAs are technical. They were engineers, scientists, or technical operators before they were ITAs. The conversations work better when you bring real technical detail rather than a sales pitch.
- They have allocation, not infinite money. Each ITA has an envelope for their region and the budget year. Smaller, well-scoped first projects move faster because they don't consume the full allocation.
- They want to say yes. An ITA's job is to fund credible R&D, not to gatekeep. If your project is not landing, it's usually because the technical novelty is not visible, the commercial story is unclear, or the team's capacity to deliver is in doubt. All three are fixable.
- They will rescope. First-pass scopes often get tightened. This is good — a tighter scope clears underwriting faster and gives you a higher chance of follow-on projects.
- They want subcontractor credibility. When you name a subcontractor, the ITA wants to see prior work, Canadian operating presence, and a delivery model that survives milestone reviews. We prepare a one-page subcontractor brief that addresses exactly this — let us know if it would be useful for your application.
What we ship — production AI work, not slide decks
IRAP funds work, not promises. Your ITA will want to see a subcontractor who has shipped before. Three engagements from the last 18 months that map to the kind of work an IRAP / AI Assist project funds:
Khalas Kitchen — AI-driven ordering, intake automation, and loyalty re-engagement across multiple locations. Custom workflow architecture, not off-the-shelf SaaS. Read the case.
ShamelaGPT — domain-specific AI assistant over a closed knowledge corpus. The retrieval architecture is the same pattern used in IRAP-funded SME knowledge-base projects. Read the case.
AI Footprint — content + syndication automation that compounds over months. The kind of marketing R&D system AI Assist often funds. Read the case.
Common questions about NRC IRAP
Does my SME qualify for NRC IRAP?
IRAP is for incorporated, for-profit Canadian SMEs with 500 or fewer FTEs, pursuing technology-driven R&D with commercial intent. There is no minimum revenue floor and no sector restriction. The hard gates are (a) you are incorporated in Canada, (b) you are pursuing genuine R&D rather than off-the-shelf adoption, and (c) you can articulate a commercial outcome. Pre-revenue startups can qualify if the R&D is credible — the ITA's job is to evaluate that.
What kind of R&D actually counts for IRAP?
IRAP funds technology-driven development where the outcome is not certain in advance — there has to be a technical challenge that requires experimentation. For AI projects this usually means custom model work, novel integration of multiple systems, retrieval architectures over proprietary corpora, or building agents that perform tasks where the right approach is not obvious from public documentation. Pure SaaS adoption (subscribing to an off-the-shelf tool with no novel build) generally does not count — and that is what BDC LIFT is for.
Can Creatrixe's invoice be claimed as an IRAP-eligible cost?
Yes. IRAP explicitly recognizes subcontractor costs as eligible, typically reimbursed at 60–80% alongside the SME's own technical labour. When your IRAP project includes AI development work that Creatrixe is delivering, our invoice for technical work falls within the reimbursable scope — subject to your ITA approving the contribution agreement with us named as subcontractor. We provide the documentation pattern (engagement model, prior delivery references, milestone structure) that ITAs expect to see during scoping.
How is IRAP different from BDC LIFT and SR&ED?
Three different instruments solving different problems for the same SME:
IRAP is non-repayable contribution funding for R&D, paired with ITA advisory. You spend, you claim, you get reimbursed at the agreed percentage. Budget 2024 added a $100M AI Assist sub-stream specifically for AI projects.
BDC LIFT is a loan program for AI adoption — deploying known systems rather than running R&D. $25K–$5M loans with a 2.25% preferential rate when you pick a Canadian integrator. Read the full LIFT explainer.
SR&ED is a tax credit, claimed retroactively against R&D spend through the corporate tax return. It stacks with IRAP — you can be receiving IRAP contributions and claiming SR&ED credits on the same technical labour, subject to the usual stacking rules (the IRAP contribution typically reduces the SR&ED-eligible base by the contribution amount, but the net benefit is still substantial).
What is the typical IRAP application timeline?
Initial contact with an ITA takes 1–3 weeks. ITA scoping runs another 3–6 weeks. Formal application and contribution agreement takes 4–10 weeks depending on project size — smaller first-time projects ($75K–$200K) tend to move faster than $1M+ asks. Plan for 8–16 weeks from first contact to disbursement. Continuous intake means there is no application window, but ITA bandwidth varies by region and time of year.
What happens if my IRAP application is rejected?
Rejections at the ITA scoping stage are common and not punitive — most often they reflect a project that is not technically novel enough to count as R&D, or a commercial story that is not credible at the requested scale. The ITA will usually tell you what is missing and whether a rescoped version could work. SMEs that get rejected on novelty grounds frequently re-route the same project to BDC LIFT (which funds adoption, not R&D) and proceed without losing the calendar — and that is often the right outcome.
What is the AI Assist sub-stream?
AI Assist is a $100M / 5-year envelope added in Budget 2024 specifically for SMEs adopting and developing AI. It runs inside IRAP using the same ITA-led model and the same contribution mechanics, but the project framing is AI-specific — building, integrating, or substantially adapting AI systems. It is the most direct federal R&D money for AI projects under the IRAP umbrella, and from the SME's side the application looks identical to a standard IRAP application.
Will IRAP still exist after the Canada Innovation Corporation transition?
IRAP is slated to move into the Canada Innovation Corporation by 2026-27. The program is currently active and accepting applications. Federal communications indicate the IRAP delivery model (ITAs, non-repayable contributions, eligible subcontractor costs) will be preserved through the transition. We recommend SMEs proceed under the current framework rather than waiting — the program is not pausing, and projects in flight at the transition will be honoured.
The honest pre-call read
Before you book a scope call, here is the short version of what we'll tell you so you can decide whether the call is worth your time.
- If you're not incorporated, you don't qualify. Incorporate first.
- If your project is rolling out an off-the-shelf SaaS tool with minor configuration, it's not R&D and IRAP won't fund it. Look at BDC LIFT instead.
- If your project has real technical uncertainty — novel integration, custom model adaptation, retrieval over a proprietary corpus, multi-agent orchestration on a domain-specific problem — IRAP or AI Assist is plausibly the right instrument.
- If you've never engaged with an ITA before, the first conversation will go better with a one-page technical scope. We'll help you prepare it.
- If you're chasing IRAP and LIFT in parallel, we can hold both threads — but you'll need to be clear which work falls into which instrument before you go to either.
For more on how we think about AI work generally, the human-assisted vs. AI-assisted workflows post is the best primer. For the deployment-side counterpart to this page, see BDC LIFT and our readiness assessment service. If your scope is going to live in your front office, the AI receptionist service is the canonical reference for that work pattern.
Bring us in before you submit the IRAP application.
20-minute call. We'll tell you whether the project is technically novel enough to clear ITA scoping, what a defensible subcontractor brief looks like, and — if IRAP isn't the right instrument — we'll point you at LIFT or SR&ED instead.