Not All "Grants" Are Actually Grants: Understanding Canada's Funding Types

"Grant" gets used loosely in Canada to describe several different funding types that work very differently in practice. Knowing which type you're actually looking at changes how you should plan around it.

True grants

Non-repayable funding tied to a specific project, typically paid out against submitted expenses or milestones. This is what most people picture when they hear "grant," and it's the smallest category of what actually gets called one.

Refundable tax credits

SR&ED is the best-known example: not a grant you apply for upfront, but a credit claimed after the fact against eligible spending already incurred, refunded even if you owe no tax.

Loan guarantees and repayable financing

Programs like the Canada Small Business Financing Program get grouped under "grants" in casual conversation but are structured as loans or loan guarantees, meaning the money gets repaid.

Equity and matching investment

Some provincial programs, particularly in Quebec, provide capital as an equity investment rather than a grant, which means giving up a stake in the business rather than just completing a project report.

Next steps

Run FundScout's free eligibility check to see which specific funding type actually applies to your project before you plan around it. Check your matches.