Canadian AI Grants & Funding Programs
The Canadian government offers over $500,000 in combined grants, tax credits, and financing to help businesses adopt AI. This guide compares every major program so you can find the right fit for your business.
All Canadian AI Funding Programs at a Glance
Compare grant amounts, program types, and ideal use cases to narrow down which programs align with your business.
CDAP (Closed)
Program closedGrant + Loan (Closed)
No longer accepting applications — see BDC Data to AI
IRAP
$100K+ (varies)Non-repayable contribution
AI R&D and technology development (SMBs < 500 FTEs)
SR&ED
35% federal ITC + 8% OntarioRefundable tax credit
Custom AI R&D (algorithm development, ML training, experimentation)
OIDMTC
40% of eligible Ontario labourProvincial tax credit
AI-powered interactive digital media products (Ontario corps)
FedDev Ontario
Up to $200K (varies by stream)Contribution / grant
Ontario-based SMBs scaling AI solutions
BDC
Up to $500KLow-interest loan
Implementing AI tools, platforms, and infrastructure
Funding amounts represent maximum program limits and vary based on applicant profile, project scope, and program availability. Figures current as of early 2026.
CDAP -- Canada Digital Adoption Program (Closed)
The Canada Digital Adoption Program (CDAP) is no longer accepting new applications as of February 19, 2024. The program previously provided up to $15,000 for digital adoption planning plus a 0% interest BDC loan of up to $100,000 for implementation. BDC's Data to AI program is the successor, offering expert guidance and preferential-rate financing for AI, automation, and cybersecurity adoption.
Key Eligibility Criteria
- Program closed to new applicants as of February 2024
- BDC Data to AI is the successor program for digital transformation financing
- Previously required: Canadian-incorporated, 1-499 employees, $500K-$100M revenue
- Existing approved applicants may still complete their plans
NRC IRAP -- Industrial Research Assistance Program
The National Research Council's Industrial Research Assistance Program (NRC IRAP) is one of Canada's premier innovation support programs for small and medium-sized businesses. IRAP provides two core services: expert advisory assistance from Industrial Technology Advisors (ITAs) who work closely with your team, and non-repayable financial contributions for qualifying technology development projects. For AI-focused businesses, IRAP can fund the development or significant customization of machine learning models, AI-driven products, and intelligent automation systems. Contribution amounts typically range from $50,000 to over $100,000, depending on the project scope and business size.
Key Eligibility Criteria
- Canadian incorporated small or medium-sized business
- Fewer than 500 full-time equivalent employees
- Pursuing technology-driven innovation (including AI development)
- Capacity to commercialize the technology within Canada
SR&ED -- Scientific Research & Experimental Development
The Scientific Research and Experimental Development (SR&ED) program is the largest single source of federal government support for R&D in Canada. Administered by the Canada Revenue Agency (CRA), SR&ED provides refundable Investment Tax Credits (ITCs) on qualifying research expenditures. For Canadian-Controlled Private Corporations (CCPCs), the federal credit is 35% on the first $800,000 of eligible expenditures. Provinces layer additional credits on top: Ontario's 8% Innovation Tax Credit, for example, brings the combined rate to approximately 43% on qualifying AI development work. Eligible activities include developing novel AI algorithms, training custom machine learning models, and conducting systematic experimentation to resolve technological uncertainties in AI systems.
Key Eligibility Criteria
- Canadian business conducting qualifying scientific research or experimental development
- CCPCs receive the enhanced 35% refundable rate (vs. 15% for non-CCPCs)
- Work must involve technological uncertainty, systematic investigation, and advancement
- Eligible costs include salaries, materials, and a portion of contractor expenditures
OIDMTC -- Ontario Interactive Digital Media Tax Credit
The Ontario Interactive Digital Media Tax Credit (OIDMTC) is a refundable provincial tax credit that covers 40% of eligible Ontario labour expenditures and 40% of eligible marketing and distribution expenses for qualifying interactive digital media products. Administered by Ontario Creates, the OIDMTC is particularly relevant for companies developing AI-powered applications, intelligent digital platforms, and interactive tools that incorporate machine learning. This is one of the most generous provincial credits available for digital product development. There is no annual cap on the credit, making it especially valuable for companies with significant Ontario-based development teams working on interactive AI products.
Key Eligibility Criteria
- Ontario-incorporated corporation or Canadian corporation with a permanent establishment in Ontario
- Developing an interactive digital media product (must have user interactivity)
- Product must not be primarily for promotional purposes or contain primarily non-interactive content
- Labour expenditures must be incurred in Ontario for work performed in Ontario
FedDev Ontario -- Regional AI Funding
The Federal Economic Development Agency for Southern Ontario (FedDev Ontario) administers several funding streams that support AI adoption and technology development in the region. Programs like the Regional Innovation Ecosystem stream and the Business Scale-up and Productivity program provide non-repayable contributions to help SMBs adopt advanced technologies, commercialize innovations, and scale operations. For AI-focused projects, FedDev Ontario can fund technology adoption, workforce training, and digital transformation initiatives. Funding amounts vary by program stream and project scope, with many streams offering contributions up to $200,000 for qualifying projects. Similar Regional Development Agencies operate across Canada, including PrairiesCan, PacifiCan, ACOA, and CED for Quebec.
Key Eligibility Criteria
- Business located in southern Ontario (other regions served by PrairiesCan, PacifiCan, ACOA, CED)
- Project focused on technology adoption, productivity improvement, or innovation commercialization
- Able to demonstrate economic impact (job creation, revenue growth, export potential)
- Must meet program-specific criteria for the active funding stream
BDC -- AI Financing & Advisory
The Business Development Bank of Canada (BDC) offers dedicated AI adoption financing designed for Canadian businesses at any stage of their AI journey. BDC's technology-focused loans of up to $500,000 can fund AI software licences, implementation services, data infrastructure, cloud computing resources, and workforce training. BDC also provides advisory services through its Data to AI program (the successor to the now-closed CDAP) to help businesses develop AI strategies and identify the right technology partners. As a Crown corporation, BDC offers favourable terms including flexible repayment schedules and competitive interest rates. BDC financing can be combined with other grant programs to maximize available capital for AI projects.
Key Eligibility Criteria
- Canadian-owned and operated business
- Viable business plan for AI adoption or technology investment
- Demonstrated ability to repay the loan
- BDC financing available alongside other grants and credits (stackable)
Which Grant Is Right for You?
The right program depends on where you are in your AI journey, the nature of your project, and your business profile. Use these scenarios to identify the best starting point.
You want to plan your AI strategy
Explore BDC Data to AI
If you haven't yet defined an AI adoption strategy, BDC's Data to AI program offers expert advisory guidance paired with preferential-rate financing to help you adopt AI, automation, and cybersecurity solutions. This is the successor to CDAP (which closed in February 2024) and is the best entry point for businesses that are AI-curious but unsure where to begin.
You are building or customizing AI technology
Apply for IRAP
If your project involves significant technical development, such as building custom ML models, developing AI-powered products, or conducting systematic experimentation, IRAP provides both advisory support and non-repayable funding. IRAP is particularly valuable for businesses with an R&D component to their AI work.
You are already spending on AI R&D
Claim SR&ED credits
If your team is already conducting qualifying AI research and development, you may be leaving money on the table by not claiming SR&ED. The 35% federal credit (plus provincial top-ups) can return a significant portion of your AI development costs as a cash refund. Talk to a SR&ED specialist to see if your work qualifies.
You are developing an interactive AI product in Ontario
Look into OIDMTC
If your Ontario corporation is building an interactive digital media product that incorporates AI, the OIDMTC provides a 40% credit on eligible Ontario labour costs. This is one of the most generous provincial credits available and has no annual cap.
You need capital to implement AI tools
Explore BDC financing
If you have identified the AI tools and platforms you want to adopt but need financing for implementation, BDC offers dedicated AI loans up to $500,000 with favourable terms. BDC financing can be combined with other grants to maximize your available capital.
Not sure where you fit? Our free assessment analyzes your business profile against all six programs and shows where you may have the strongest alignment.
Can You Stack Grants?
Combining multiple programs to maximize your AI funding
Yes, most Canadian AI grants and tax credits can be combined, which is commonly referred to as “stacking.” The key rule is that you generally cannot use two programs to fund the exact same dollar of expenditure. However, different programs can cover different cost categories within the same overall project, or different phases of your AI adoption journey. Strategic stacking can significantly increase the total funding available to your business. Below are some common and effective combinations:
BDC Data to AI + SR&ED
Use BDC Data to AI financing for your digital transformation implementation, then claim SR&ED credits on the qualifying R&D portion of your AI development. Advisory and implementation costs funded by BDC are not SR&ED-eligible, but any subsequent experimental development work may be.
IRAP + SR&ED
IRAP contributions can be received concurrently with SR&ED claims, but you must reduce your SR&ED claim by the amount of IRAP funding received for the same expenditures. Many businesses use IRAP for project-specific costs and SR&ED for broader R&D activities.
BDC Data to AI + IRAP
Use BDC Data to AI for advisory guidance and implementation financing, while applying for IRAP contributions for the R&D portion of your AI project. Both programs can operate in parallel, though you cannot double-fund the same expenses.
SR&ED + OIDMTC
Ontario companies can claim both federal SR&ED credits and the provincial OIDMTC on the same project, though not on the exact same expenditures. Typically, SR&ED covers R&D activities while OIDMTC covers broader interactive product development labour.
IRAP + FedDev Ontario
Federal regional programs can be combined with IRAP, though both programs will coordinate to avoid funding the same costs twice. This combination works well when IRAP funds the R&D phase and FedDev funds the commercialization or scale-up phase.
Important: Stacking rules are complex and vary by program. Always verify with the respective program authority or a qualified grants advisor before assuming programs can be combined. Qyntral does not provide professional financial or legal advice on grant stacking.
Grant Guides & Resources
In-depth articles to help you understand each program and prepare your applications.
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Frequently Asked Questions About Canadian AI Grants
What Canadian government grants are available for AI projects?
The main active programs include BDC Data to AI (expert guidance plus preferential-rate financing), NRC IRAP (non-repayable contributions that can exceed $100,000), SR&ED tax credits (35% federal ITC for CCPCs plus provincial top-ups), OIDMTC (40% Ontario labour credit), FedDev Ontario regional AI funding (up to $200,000), and BDC AI financing loans (up to $500,000). Note: CDAP is no longer accepting new applications as of February 2024. Eligibility varies by program and business profile.
Can I apply for multiple AI grants at the same time?
Yes. Most Canadian AI grants and tax credits can be combined, or stacked. For example, a business could claim SR&ED credits on qualifying R&D expenditures, access BDC Data to AI financing, and apply for IRAP contributions simultaneously. However, you generally cannot use two programs to fund the exact same expense. Each program has its own stacking rules, so review the terms carefully or consult a grants advisor.
Is the CDAP grant still available?
No. The CDAP Boost Your Business Technology stream stopped accepting new applications on February 19, 2024. BDC's Data to AI program is the successor, offering expert guidance and preferential-rate financing for AI, automation, and cybersecurity adoption. Businesses already approved before the closure may still be completing their plans.
How does the SR&ED tax credit work for AI development?
The Scientific Research and Experimental Development (SR&ED) program provides a 35% refundable federal Investment Tax Credit for Canadian-Controlled Private Corporations (CCPCs) on the first $800,000 of qualifying expenditures. Provinces like Ontario add an 8% top-up. Eligible work includes developing new AI algorithms, training custom machine learning models, and conducting systematic AI experimentation. The credit applies to wages, materials, and certain contractor costs associated with qualifying R&D activities.
What is the difference between IRAP and BDC Data to AI?
IRAP (Industrial Research Assistance Program) provides non-repayable contributions plus expert advisory services for technology development, and is better suited for businesses building or significantly customizing AI solutions. BDC's Data to AI program (the successor to CDAP) focuses on advisory guidance paired with preferential-rate financing for adopting existing AI, automation, and cybersecurity tools. IRAP is administered by the NRC, while BDC Data to AI is run by BDC.
Does Qyntral guarantee grant eligibility or approval?
No. Qyntral provides an assessment tool that helps identify potential alignment between your business profile and various Canadian funding programs. Our tool does not constitute professional financial, tax, or legal advice. Final eligibility and funding decisions are made solely by the respective program authorities such as NRC-IRAP, ISED, the CRA, and Ontario Creates. We recommend consulting a qualified grants advisor before submitting applications.
How long does it take to receive AI grant funding in Canada?
Timelines vary significantly by program. CDAP grants can be approved in 4 to 8 weeks. IRAP projects may take 2 to 6 months from initial contact to contribution agreement. SR&ED claims are typically filed with your annual tax return and processed within 60 days for refundable credits. BDC financing can be arranged in 2 to 4 weeks. Planning ahead and having your documentation ready can help accelerate these timelines.
What size of business qualifies for Canadian AI grants?
Most programs target small and medium-sized businesses (SMBs). CDAP requires 1 to 499 employees. IRAP serves firms with fewer than 500 full-time equivalents. SR&ED is available to any Canadian business conducting qualifying R&D, though CCPCs with taxable capital under $10 million receive the most favourable rate. OIDMTC is available to Ontario-based corporations. BDC financing is open to all Canadian businesses with a viable AI adoption plan.