A CRA audit needs the story behind the numbers
Roncesvalles taxpayers may receive a CRA audit request about professional income, an owner-managed business, contract work, rental property, GST/HST, payroll, personal banking, or a deduction claimed on a return. The evidence may be scattered across invoices, payment platforms, bank accounts, lease files, receipts, email, and bookkeeping systems. CRA may see a deposit or an expense on a return without understanding what it represents.
The audit letter normally identifies the years under review, the account, the records requested, CRA contact details, and a deadline. It may examine income, expenses, GST/HST, payroll, property use, rental activity, deposits, or a personal claim. A well-prepared response answers the questions in the letter and ties the figures to supporting documents. It should do more than provide a large, unlabelled collection of files.
Tax Help Canada helps Roncesvalles residents, professionals, contractors, business owners, landlords, property owners, and families manage CRA audit files. We review the scope, organize evidence, prepare reconciliations and explanations, communicate with CRA, and help assess a proposal or reassessment before deadlines narrow the available options.
Identify the audit issue before replying
CRA may ask for statements, invoices, receipts, contracts, GST/HST returns, payroll reports, property records, or a written explanation. A review of deposits can test reported income. A property question can involve rent, personal use, repairs, or a capital improvement. A worker-payment request can concern source deductions or contractor classification.
Professional and business files may include client invoices, sales, payment reports, equipment, vehicles, expenses, payroll, and GST/HST. Rental records can include leases, deposits, financing, taxes, insurance, repairs, and personal-use history. This initial work identifies missing evidence early enough to request it from banks, suppliers, clients, tenants, property managers, former bookkeepers, or online portals.
Reconcile income, deposits, and GST/HST
CRA may compare income reported on a return with invoices, deposits, payment reports, GST/HST filings, and third-party information. A deposit is not necessarily business income. It can be sales revenue, rent, tax collected, a transfer, loan proceeds, reimbursement, refund, or money received for another person. Material items should have a documented source.
We prepare schedules that connect sales to invoices or payment reports, rent to leases and deposits, and transfers to matching account movements. Loans, reimbursements, refunds, merchant fees, and other non-income amounts need support. This helps explain why gross sales, net deposits, and GST/HST may differ and reduces the risk that CRA treats a non-income deposit as unreported revenue.
Expenses need the same attention. Vehicles, equipment, home office, supplies, travel, repairs, property costs, and payments to workers should be supported and connected to an income-earning purpose. Where personal use exists, a reasonable allocation should be shown.
Rental and business records must agree
An audit may start with one return but reach GST/HST, payroll, business banking, corporate records, rental activity, and personal reporting. A sole proprietor’s sales should fit deposits and GST/HST. An incorporated owner can have payroll, shareholder transactions, expenses, and personal income. A rental property can connect to banking and other reported income.
We consider those links before detailed submissions are sent. A deposit explanation should agree with books and GST/HST. Worker payments should fit payroll and expense records. Property costs should make sense given actual rental and personal use. This reduces inconsistent answers and helps identify potential tax, interest, penalties, payment, and collections exposure.
Rebuild incomplete records from reliable sources
Older files can be incomplete after an account change, lost receipts, an unavailable supplier, a closed online account, or a former adviser. Bank and card statements, suppliers, clients, tenants, contracts, email, property records, accounting backups, prior returns, and CRA information can support a factual reconstruction. The objective is the best accurate record available, not an unsupported estimate.
The reconstruction should explain its method. Sales can be matched to invoices and deposits; expenses to statements and vendor records; rent to lease and banking history. That allows CRA to test the response against evidence rather than assumptions.
Handle CRA communication and deadlines carefully
CRA may follow up by phone, letter, email, meeting, or secure upload. We help prepare written submissions that set out the audit question, facts, calculation, and support, while keeping a record of all requests and responses. If historic statements, duplicate invoices, payroll reports, or property records are still being collected, the issue should be raised before the deadline. In appropriate circumstances, CRA can be asked for more time.
Review a proposal before reassessment
CRA may accept the reporting, request final information, send a proposal, or issue a reassessment. A proposal can reveal an overlooked document or incorrect assumption that can still be addressed. If CRA reassesses, objection deadlines, interest, penalties, payment arrangements, and collections concerns may follow.
Get a clear audit plan
If CRA has contacted you about a Roncesvalles audit, a confidential review can make the next step manageable. We will review the years and accounts, CRA’s questions, available evidence, and the professional, business, property, rental, or personal facts needing explanation. From there, you can respond with an organized plan grounded in evidence.