The 2021 Federal budget proposed to amend the Income Tax Act (Canada) to permit the CRA to demand interviews with owner-managers and their employees. The authors note the potential for mischief or worse where an auditor interviews an unprepared owner-manager…
All due dispatch
Two recent cases consider the meaning of “all due dispatch” as the phrase applies to the time the CRA can take to pay refunds of net GST. In both cases, the courts refused to second-guess the CRA decision to withhold…
Application denied
A taxpayer cannot bring an application for a court order preventing the CRA from exercising its power to demand records and information even where the taxpayer believes that the CRA would be estopped from issuing an assessment for a matter to which the records and information relate.
Accountant’s due diligence report
Steve Suarez, “FCA To Hear Atlas Tube Appeal” 27:12 Canadian Tax Highlights (December 2019), discusses Canada (National Revenue) v. Atlas Tube Canada ULC, 2018 FC 1086. The Federal Court held that an accounting firm’s due diligence report on the tax…
Audit success
Automobile benefits are fish in a smaller barrel for CRA auditors. If all else fails, the auditor can recover something for his or her time by reassessing them. (My experience on the subject is probably not representative. Nevertheless, it’s the…
Handing over records to CRA
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…
Audit power
Sunita Doobay, “The MNR’s Audit Powers” Canadian Tax Highlights 27:3 (March 2019) reviews three important recent cases on CRA audit powers, namely Cameco, 2017 FC 763 (power to require oral interviews), BP Canada Energy Company, 2017 FCA 61 (power to compel…
Oral questioning on audit
Canada (National Revenue) v Cameco Corporation, 2019 FCA 67, aff’g 2017 FC 763, held that the CRA, on an audit, cannot compel a taxpayer to submit to oral questioning. Of course, a refusal to answer oral questions can lead to…
Audit reversals
According to Neil Armstrong’s summary of Alexandra MacLean’s paper at the 2018 CTF Annual Conference (“CRA Audits of Large Corporations – The view from ILBD”), CRA Tax Services Offices and programs are assessed by “tax earned by audit” for the…
Offshore account explored
The taxpayer in Canaada (National Revenue) v Stankovic, 2018 FC 462, had held a bank account in Switzerland that French authorities disclosed to the CRA under the French treaty. The French authorities, it appears, had obtained the information about the…