Federal vs provincial grants: what's the difference?
How to think about Canada's two-layer grant system and why you should apply to both.
Published February 5, 2025 · 6 min read
Canada has a two-layer government funding system: federal programs that any Canadian business can apply for, and provincial programs that only businesses in that province qualify for. Most founders only know about half of either layer, which means they miss out on real money.
Federal programs
Federal programs are administered by departments like Innovation, Science and Economic Development (ISED), Agriculture and Agri-Food Canada, and Employment and Social Development Canada. They apply across all provinces.
Examples: CDAP, Canada Job Grant, CanExport, NRC IRAP, the Strategic Innovation Fund. These programs do not care which province you are in. Anyone in Canada can apply.
Provincial programs
Each province has its own ministry of economic development, its own innovation agency, and often industry-specific programs targeting strategic sectors.
Quebec has CDAE for tech businesses. Manitoba has its Interactive Digital Media Tax Credit. Saskatchewan has the Technology Startup Incentive. Nova Scotia has the Digital Media Tax Credit. The list goes on.
Why you should apply to both
Federal and provincial programs do not compete. They stack. You can take CanExport (federal) and your province's equivalent export support in the same year. You can claim federal SR&ED and your provincial R&D tax credit on the same R&D expenditure.
The combined benefit can be 30 to 50 percent more money than you would get by applying only at one level.
How to discover both layers
Federal programs are reasonably well-publicized. They show up in business media. Your accountant probably knows the major ones.
Provincial programs are where most businesses fall short. They are buried on provincial government websites that are usually worse than the federal ones. Half the time the program names are in French or have unmemorable acronyms.
This is the gap Deductly fills. We track both layers automatically and surface them based on which provinces your business operates in.
If you are only applying to federal programs, you are leaving real money on the table. Take the Deductly quiz to see both your federal and provincial options at the same time.