The Canada Revenue Agency (CRA) audits aim to make sure the tax system is fair for every Canadian. During your audit, the CRA examines your records to confirm you are fulfilling your tax obligations, following the tax laws, and receiving the right benefits and refund.
For audits, you provide your relevant paper and electronic records, supporting documentation, and explanations for the auditor. Failure to provide these is an offence under the law.
For an audit, you probably have some questions and feel stressed. Remember, CRA wants to make sure your taxes are correct. Unless there is some criminal wrongdoing, the only risk is that your mistakes are corrected, and you pay the tax you owe.
Why CRA chooses your file to audit
CRA uses a risk assessment process to decide which files to audit. It’s not personal! The assessment considers non-compliance chances or the frequency of errors. CRA looks at information in your file and compares that to similar data from other audits.
How does the CRA do an audit?
An auditor contacts you and tells you when and where the audit will take place. Most are on-site, but some take place at the CRA office. So, always be sure to bring or send supporting documents.
Sending records by email
Auditors cannot receive your records by email because it may not be secure. Your auditor will tell you how to send documents online with CRA’s secure service.
After the audit, then you find out the results.
Correct assessment – If your previous filing was correct, there is nothing more to do. The audit closes.
Taxes owed or refund – If you have more tax to pay or are entitled to a refund, a proposal letter then explains the reasons and gives you 30 days to agree or disagree. If you disagree, contact the auditor and explain why. Provide documentation to support your position. Your auditor considers your explanation and then responds to your questions. If you disagree with the reassessment, you have the right to an appeal.
See more ‘How do I make a payment to CRA?‘
You can contact the team leader at the audit office at any time. The contact information is on all audit correspondence. If you are not satisfied, you have the right to file a complaint.