Form T661 (26): what changed, line by line

Form T661 (26) is the first version of the SR&ED claim form to carry a capital column, and that one structural change explains most of the thirty line and box numbers the CRA had to write fresh instructions for. The CRA posted the updated form in May 2026 to reflect Bill C-15, which received Royal Assent on March 26, 2026 (CRA SR&ED news and updates). The form grew from nine pages to eleven.

The awkward part is where the instructions live. Guide T4088 is where you would normally look up a line number, and it has not been rewritten. The CRA says so on its own news page: "The Guide T4088 is currently being revised." Until it is, the authority for these lines is a block of interim instructions under a collapsed heading on a news page, which is not where anyone looks.

At a glance

• Form T661 E (26) is the current version. The CRA's form page was last updated May 15, 2026 (canada.ca).
• Bill C-15 received Royal Assent on March 26, 2026, and the measures apply for tax years beginning after December 15, 2024.
• Capital expenditures for depreciable property acquired after December 15, 2024 go on new line 390.
• Part 4 now runs current and capital side by side, and line 559 no longer means what it meant on the (20) form.
• Shared-use-equipment returns on line 504 and in the new Part 6C. The CRA revised the Shared-Use-Equipment Policy on May 22, 2026 and the Capital Expenditures Policy on June 29, 2026.
• Guide T4088 (Rev. 26) does not document the new lines. Its "What's new?" section says only that the guide was revised to update the contact information for the coordinating tax services offices and the support services and tools.

What changed on Form T661 (26)?

Capital spending is claimable again, and capital had to be threaded through every part of the form that already handled current expenditures. Part 3 gained lease and capital lines. Part 4 gained a parallel capital column with its own line number beside nearly every deduction. Part 6 gained two asset tables. Part 2 picked up three additions unrelated to capital.

Part 2: two codes and a pre-approval box

Three new fields sit in the project identification block. Line 207 asks for a Canada Research and Development Classification field of research code, first five digits only, in the form RDF#####. Line 212 is a tick box for a project that received pre-claim approval, and line 214 takes the case number.

Line 207 does not replace line 206, the field of science or technology code you already fill in. It sits beside it, and the codes come from the Statistics Canada CRDC 2020 Version 2.0 field of research list rather than from T4088. It feeds R&D statistics and has no bearing on eligibility, but the classification was built for granting agencies, so expect junior staff to miscode it at first.

Lines 262 and 263 are the ones that will hurt. If you claim capital, you name the property used for SR&ED on line 262 and give the percentage of its total operating time spent on that project on line 263, for the 10 largest capital expenditures in each project.

Part 3: leases on 350 and 355, capital back on 390

Line 390 is the restored capital line, for depreciable property acquired after December 15, 2024. Lines 350 and 355 handle leased equipment. Line 350 takes lease costs for equipment used all or substantially all of the time for SR&ED, meaning 90% or more. Line 355 takes half the lease cost of equipment used primarily for SR&ED, between 50% and 90%, and only under the proxy method.

On the traditional method, line 355 gets a zero and those lease costs go to line 360 as overhead instead.

Line 390 on the form tells you to see the guide for what qualifies. The guide skips from line 370 straight to line 400.

Part 4: line 559 does not mean what it used to

Part 4 now has a current column and a capital column, and the arithmetic runs down both. Government assistance, non-government assistance, prescribed expenditures, other deductions and the non-arm's length adjustments each have a capital twin: lines 514, 516, 518, 532, 535, 540, 543 and 546. Line 504 carries shared-use-equipment and line 510 carries qualified expenditures transferred to you, both on the capital side.

Then the subtotals move. On the (20) form, line 511 minus lines 513 to 544 landed on line 559, and 559 was your qualified SR&ED expenditures. On the (26) form that same calculation lands on line 557. Line 558 is the capital equivalent, and line 559 is now the sum of the two.

This is the change most likely to slip through, because it does not misstate anything. A client with no capital spending produces the same dollar figure either way, so nothing looks wrong on the return. What breaks is every spreadsheet, working paper and form map in your practice that treats 559 as the current-column total. Check yours before the next filing rather than after.

Part 6 is now 6A, 6B and 6C

Part 6 used to be one table of project costs. Part 6A keeps that breakdown and adds box 759 for leased equipment costs, which must tie to lines 350 and 355. Part 6B covers your 20 largest capital expenditures: box 780 for the property name, 782 for the amount, 786 for the projects it was used in. The names on 780 have to match what you put on line 262.

Part 6C is shared-use-equipment, and almost nobody in this business has filled one in recently. The definitions in subsection 127(9) now apply only to property acquired after December 15, 2024. Shared-use treatment lets equipment used primarily but not almost exclusively for SR&ED still reach the claim: 25% of its capital cost in the first term and another 25% in the second, so half the cost lands on line 504 across two years. Part 6C wants the name (788), purchase date (790), 25% of capital cost (792), a 1 or 2 for the term (794) and the project numbers (796).

An illustrative case: a client buys a $60,000 test bench and runs it 70% on experimental work. It fails the 90% test, so it is not a line 390 capital expenditure, but it can qualify as shared-use-equipment and put $15,000 into the claim in each of two terms. Miss the classification and the asset falls out of the claim.

What this actually changes in your practice

Not the form-filling. The intake. Read the new boxes together and the CRA is asking for asset-level facts that no 2024 intake questionnaire collected: property names, purchase dates, per-project operating-time percentages, first or second term. An invoice gets you the name and the date. It does not get you line 263, because percentage of operating time is a measurement, and you cannot reconstruct a measurement in June from a purchase order.

So the useful work this month is boring. Add the equipment questions to intake now, while the client can still tell you how the machine was actually used, and warn your team that the guide is not the source for these lines yet. Bookmark the news page, or use a T661 guide we keep current as the CRA updates the form.

The CRA processed 23,677 SR&ED claims in the year ending March 31, 2026, and 6% were accepted only after modifications (SR&ED annual program statistics). That was before the form grew a capital column and lost its guide.

Frequently asked questions

Which version of Form T661 should I file now?
T661 E (26) is the version the CRA currently posts. The new capital and lease lines only carry amounts for tax years beginning after December 15, 2024.

Does Guide T4088 explain the new T661 lines?
No. T4088 (Rev. 26) has no entries for lines 355, 390, 504, 510 or any of the Part 6B and 6C boxes, and the CRA states the guide is being revised. Use the interim instructions on the SR&ED news and updates page.

What is line 207 on Form T661?
It is the Canada Research and Development Classification field of research code, taken from the Statistics Canada CRDC 2020 Version 2.0 list. Enter the first five digits only. It is a statistical field and does not affect eligibility.

Did line 559 change on Form T661?
Yes. The subtotal that was line 559 on the (20) form is now line 557, and line 559 is the total of lines 557 and 558. Anything in your working papers that maps to 559 needs rechecking.

What is shared-use-equipment and why does it matter again?
It is depreciable property used primarily, meaning more than 50% but less than 90%, for SR&ED. Half its capital cost reaches the claim, 25% in each of two terms, and it applies only to property acquired after December 15, 2024. It is reported in the new Part 6C.