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Ontario|Tax LawInvestigations by Revenue Canada 193 Audits by Canada Revenue Agency If you are audited, your tax return will be reviewed and your records will be examined. Canada Revenue Agency may determine that you owe more or less tax for that year. Most audits are not criminal investigations but are done to determine whether the taxpayer paid enough tax. In extreme cases, an audit will be done to investigate if a taxpayer has been intentionally evading taxes, which may result in prosecution similar to a criminal prosecution.
- Canada Revenue Agency audits
If Canada Revenue Agency is going to audit you or your business, you will usually receive a written notice and then an auditor may contact you to set a date to start the audit. If you are being audited, you may want to consult a lawyer or an accountant about your rights and the process before you meet with the auditor.
The auditor will review your income tax return, and will usually want to see bank account statements, original receipts, your books or records, and financial statements from your business.
The auditor has the legal authority to inspect any documents that relate to the tax return being reviewed. The auditor also has the authority to enter a business premises without a warrant and require the owner or manager to provide reasonable assistance. However, an auditor does not have the authority to enter your home unless you agree to it or the auditor gets a warrant from a judge.
An audit normally takes up to two weeks to complete, although a simple audit of an individual will take substantially less time.
If the auditor finds that there were errors in your return, the auditor will usually first give you a chance to provide further information that might explain the situation before finalizing the audit. If the auditor finds that your tax return was incorrect, you will usually receive a Notice of Assessment or Reassessment which corrects the tax return and shows if there is any tax money owing. In rare cases it is possible for the Assessment or Re-assessment to find that Canada Revenue Agency owes the tax payer money. If you are found to owe more tax than you thought or if you are charged a penalty, you have the right to appeal.
For more information about Canada Revenue Agency audits you can call their general inquiry line listed in the Blue pages of your telephone book.
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