From E-Business to AI Business: Québec’s New CDAEIA Funding Program 

As Québec steps into a new era of innovation, the tax credit landscape is shifting. The familiar Crédit d’impôt pour le développement des affaires électroniques (CDAE) or Tax Credit for the Development of E-Business, as it’s known in English, is evolving into the Crédit d’impôt pour le développement des affaires électroniques intégrant l’intelligence artificielle (CDAEIA), the E-Business that includes Artificial Intelligence (AI) Tax Credit in English.  

For Québec businesses working in software, digital services, or AI‐powered platforms, this change matters. In this blog, you’ll learn what’s staying the same, what’s new, how to prepare, and how other funding programs fit in. 

[sc name= [“hspotnewsletter”]

What’s Changing: From CDAE to CDAEIA 

The shift from CDAE to CDAEIA reflects Québec’s desire to channel funding toward deeper technological innovation, especially artificial intelligence. Under CDAEIA, eligible projects must incorporate substantial AI or intelligent automation capabilities, not just traditional e-business solutions. 

Key changes: 

• The total credit rate remains at 30% of eligible salaries, but the split between refundable and nonrefundable portions will shift: 2025 = 23% refundable + 7% nonrefundable; 2026 = 22% + 8%; 2027 = 21% + 9%; 2028+ = 20% + 10%.  
• The salary cap under CDAE ($83,333) is removed, favouring highly qualified AI professionals.  
• The first 18,571$ (corresponding to the basic personal amount) will now be  excluded per employee; only salary above that “exclusion threshold” qualifies.
• Eligibility criteria tighten; companies must demonstrate significant AI integration (e.g., machine learning, neural networks, or intelligent decision‐making) and still meet TI/IT revenue thresholds.  
• The transition applies to fiscal years beginning after 31 December 2025.  

“The CDAEIA aims to modernize the activities eligible under the CDAE by refocusing on e-business that integrate AI functionalities.”  
– Investissement Québec documentation, Invest Quebec 

The takeaway: If your company qualifies under CDAE today, you should treat 2025 as a dual planning year, running eligible CDAE projects now and aligning for CDAEIA requirements. 

Funding Snapshot: CDAEIA Program 

Here’s a breakdown of the program for quick reference. 

The CDAEIA program provides Québec businesses in the IT sector with a tax credit of up to 30% of eligible salaries for employees working on digital business projects that incorporate meaningful AI/automation elements. 

Objectives: 

• Encourage Québec-based digital/IT companies to integrate artificial intelligence into their business solutions. 
• Deploy high-value-added technological activities domestically. 
• Support the competitiveness of Québec’s tech ecosystem. 

Funding amount:  

• Up to 30% of eligible salaries (split between refundable and nonrefundable parts). 

Eligible applicants: 

• A Québec-based corporation with an establishment in Québec, operating in the IT sector.  
• At least 75% of its gross revenue from IT activities and at least 50% from specific NAICS codes (e.g., 513211, 513212, 51821, 541514, and 541515).  
• Minimum of six eligible full-time employees working on eligible activities. 

Eligible projects: 

• Development or integration of information systems and infrastructures that feature significant AI functionalities (such as machine learning, neural networks, predictive analytics, or automation).  
• IT consulting, conception of systems, e-business platforms, data hosting/processing, or cybersecurity solutions where AI is a key component.  

Timeline: 

• The program was announced on March 25, 2025. 
• It applies to fiscal years beginning after December 31, 2025. Some selection options are possible for fiscal years starting after March 25, 2025, and before January 1, 2026. 

Aligning with other Québec Funding Programs 

While CDAEIA is the headline tax credit for AI integration, Québec and Canada offer complementary programs that may work alongside it. 

Scientific Research & Experimental Development (SR&ED):  

• This tax credit supports scientific research and experimental development efforts at the federal level. It can often be combined with provincial credits like CDAE/CDAEIA when salaries also qualify under the SR&ED program.
   

Tax credit for research, innovation and commercialization (CRIC):  

• This Québec measure supports clean technologies and their commercialization. As noted by analysts, the CDAEIA may be coordinated with CRIC in certain cases.  

Why this matters for Québec businesses:  

• If you’re already developing an AI-enabled solution, layering your strategy to combine credits increases return on investment. However, you must understand how to claim expenses under multiple credits. Documentation, time tracking, and project management become essential. 

Preparing Your Québec Business for the Shift 

If you are a Québec‐based company developing software solutions, SaaS, fintech, or other tech-driven sectors, now is the time to act. Here are steps you should focus on: 

• Review your activities in 2025: Projects that would qualify under the existing CDAE program should be pushed or ramped up now. The CDAE remains available for 2025 taxation years.  
• Begin scoping AI functionality: Under CDAEIA, merely evolving a digital platform isn’t enough. You’ll need to integrate AI components that drive measurable automation, machine learning, decision-making, or analytics.  
• Ensure employee tracking and salary structuring: With the salary cap gone and an exclusion threshold introduced (e.g., ~$18,571 for 2025), companies must track hours, roles, and costs carefully.  
• Organize your documentation: Keep detailed records of eligible activities, projects, and roles. This will help you apply for and obtain Investissement Québec’s attestations. Audit readiness matters.
• Coordinate with your wider funding strategy: If you’re also eligible for SR&ED or CRIC, plan accordingly so your claims align and complement one another. 
• Consider timing: Projects that begin before January 1, 2026, may still qualify under certain transitional rules, but the earlier you align with the new CDAEIA regime, the better positioned you’ll be. 

The transition from CDAE to CDAEIA marks a clear signal: Québec prioritizes smarter, higher-value digital business models powered by AI. While the tax credit rate remains the same at 30%, the eligibility requirements sharpen and the focus tightens. Companies that act now, prepare their 2025 budgets, and align for 2026 AI-centric work will gain a significant competitive and financial advantage. 

Our team in Ryan’s Canadian Government Funding practice specializes in Québec tax credits and knows how to map your digital or AI project into eligible filings.  

Contact us today to assess your eligibility, structure your project, and get the most from CDAEIA, SR&ED, and CRIC. Let’s get your application started and maximize your funding potential. 

[sc name= [“hspotevents”]