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If you have been notified that you are being audited, don’t panic. I will work with you to correct any discrepancies in your records before the auditor finds them and to minimize the disruption to your life and business. I can help to ensure that the auditor remains within their legal boundaries at all times and deal with any issues that arise to prevent further criminal investigation and reduce any financial repercussions.
An audit is merely the process whereby the Canada Revenue Agency (CRA) asks you to substantiate the declarations and figures on your filed tax returns. The CRA have substantial audit and investigative powers to ensure compliance under the self-assessment system. There is no need to panic if you are notified that you will be audited, you just need to make sure that you are prepared. Audits need to be taken seriously as they can lead to broader investigations, significant financial penalties and even have criminal repercussions.
If a CRA agent requests to visit your home or place of business, a routine audit can quickly become more complex. I strongly recommend you do not represent yourself at your own audit. You may know what to say, but you don’t know what not to say.
I can represent you throughout the course of an audit and ensure that the auditors stay within their boundaries and only obtain information to which they are entitled. I co-ordinate all communication and correspondence with the auditor on your behalf to minimize the disruption to your business or personal life. During the audit, the CRA have very broad powers to demand any information from any person with regard to a civil audit. This includes requesting documents and answers to questions from your accountant, family members, employers and colleagues. As I am a lawyer, I can give you legal privilege and confidentiality that your accountant cannot.
It is common that a taxpayer has not accurately reported a transaction or additional income. Our tax system is extremely complicated and constantly changing and it is unreasonable to expect someone to maintain a career or run a business and be an expert in tax law. People will make mistakes. Usually, it is not a problem if you have some discrepancies in your tax returns. However, depending on how this is discovered and what is said, it could lead to significant financial penalties and a larger investigation.
It is my policy to work closely with an accounting firm to conduct our own mini audit of your books and records and make any necessary corrections before presenting them to the Canada Revenue Agency. This allows us to voluntarily make any adjustments necessary to your returns and minimize the depth and penalties of the CRA audit. If the CRA discover several errors or false statements in your records before we correct them, they can assess you gross negligence penalties and even move towards a criminal investigation.
An audit is adversarial by nature as it is a government official essentially checking to see if you have broken the law. The auditor is there to get information from you to allow the CRA to determine whether you have been tax compliant and to correct any errors to ensure the maximum amount of tax is collected from you. It is important to remember that the CRA is not bound by anything that is said by one of their agents. Even if your auditor tells you not to worry about a certain transaction, their superior may see it differently and you can be re-assessed anyway.
An audit does not need to be an overwhelming experience. I will work with you to minimize the impact of your audit and to deal with any issues that arise to prevent further criminal investigation and reduce the financial repercussions. Whether you are in the middle of an audit, have just been notified or simply want help in getting your records prepared in case of an audit, I can help you to get your tax affairs in order.
Contact me today to get the legal protection and help you need to make your audit stress free.