Clients sometimes complain to me that they have given records to a CRA auditor who then returns only some of the records or returns them in a disorganized state that makes them difficult to work with. Accordingly, if a client asks me about a CRA demand for records, I usually counsel them to provide copies or to keep copies of what is provided. This can be onerous, but the alternative is to risk losing records, if the CRA is careless with them, and then have the Tax Court blame you for it. See MacDonald v R, 2019 TCC 169 (informal procedure), in which we read the following:
[12] The Appellant presented himself as an executive-level businessperson who dealt primarily with telecommunications company executives. Having in mind the duties statutorily fixed upon taxpayers to retain relevant records per subsections 260(1) and (6) of the Act [sic—presumably the reference should be to section 230], set out above, I must observe that the Appellant exhibited inadequate acumen and prudence in not retaining a copy of the expense records bundle that he sent to CRA.
