An audit by the Canada Revenue Agency can be stressful for any taxpayer. From conducting spot checks to keeping an eye on inconsistencies in the information you provide, the CRA does it all. The CRA focuses on differences between your data and that of the people you deal with. In such a situation, one needs to adopt a systematic approach to answer requests. Also, having an appropriate attitude about the process will only help reduce the challenges that an audit brings. The key is to respond promptly, supplying all the information necessary to clear up any problems.
Be polite
When you receive a call from the CRA, make sure that you write down the name, department, and phone number of the person you are talking with.
Also, do not indulge in procrastination. Give them a call back as swiftly as possible and let them know that their letter or phone call has been received by you. Also, tell them what your next plan of action is going to be. E.g. tell them if you are going to set a meeting with them or if you will have a representative contact them. Remember that ignoring or dodging them will not solve your problem. So, don’t do that.
Don’t volunteer information
Make sure that you don’t volunteer any kind of information to the CRA officials. As a matter of fact, try speaking as less as possible or don’t speak at all. Hire professional to help you deal with them. The CRA cannot force you to answer questions over the phone. You are entitled to have a representative to help you. In case the CRA is asking for any specific information, ask them to put it in writing and mail it to you. This will have two benefits, first this will award you some extra time to deal with the CRA; you can use this time to get in touch with a representative. This will also help prevent any misunderstandings between the CRA and you. Also remember that the CRA takes its own time and they are not entitled to keep you inform as what’s going on or how long it will take.
Understand the time period
An audit can take anywhere between 6-9 months from start to finish. The duration of the audit is also dependent upon the complexity of the case and how organised your information is. For instance, an appeal can take up to 1-2 months to get a response saying they have received it. Also, 6-9 months more just to get it looked at by someone in appeals.
The total time to get a decision from appeals will be between 9 and 15 months.
Challenging CRA
Don’t give up if the CRA tells you that you are having certain discrepancies, or if they have denied your appeal. If you believe that no wrong has been committed by you then you can take them to Tax Court. Going to Tax Court is not that expensive or complicated. However, you must be prepared. Objecting to a reassessments and filing appeals have time limits that must be adhered to.
Dealing with the CRA can be an intimidating experience but there is no need to be intimidated. You have certain rights that the CRA must respect. You can have a look at those rights at CRA’s website. If you are looking for legal help to deal with a CRA notice, then get in touch with Prowse Barrette (Previously Prowse Chowne).