CRA Reviews and Audits: What To Expect
CRA Reviews and Audits;
As a business owner, you may be subject to a tax review or audit by the Canada Revenue Agency (CRA). Here’s what you can expect if you are selected for a CRA review or audit.
What Is The CRA Looking For?
The CRA will notify you in writing if you are selected for a review or audit. The letter will outline the specific areas that will be examined.
You will be required to provide supporting documentation for the areas being examined. This may include tax returns, invoices, receipts, and bank statements.
The CRA will also analyze your documentation and may make adjustments to your tax return. If the CRA finds that you owe additional taxes, you will be required to pay the amount owing plus interest.
What Are Your Rights And Responsibilities?
You have the right to be represented by a tax professional during a CRA review or audit. You also have the right to appeal any findings of the CRA.
It is your responsibility to keep accurate and complete records of your income and expenses. You should maintain these records for at least six years in case you are selected for a CRA review or audit.
How Can You Prepare For A CRA Review Or Audit?
You can take steps to minimize your risk of being selected for a CRA review or audit. Be sure to keep accurate and complete records of your income and expenses. You should also file your tax returns on time and pay any taxes owed.
If you are selected for a CRA review or audit, stay calm and cooperate with the CRA. Be sure to provide all of the required documentation and information. If you have questions, seek professional tax advice.
Following these tips can help you avoid or minimize problems if you are selected for a CRA review or audit.
If you have questions about CRA reviews or audits, you should speak to a tax professional BBS Accounting CPA, we can help you understand the process and ensure that your rights are protected.