A CRA audit requires a response that ties each record to the return

Streetsville taxpayers may receive a CRA audit request involving professional income, an owner-managed business, contractor work, rental property, GST/HST, payroll, personal banking, or a tax claim. Relevant documents may be held in invoices, payment applications, bank accounts, receipts, lease files, contracts, and accounting software. CRA may see a reported amount or a deposit without seeing the engagement, transaction, or tax treatment behind it.

The audit letter usually identifies the years being reviewed, account, records requested, CRA contact, and deadline. It may test income, expenses, GST/HST, payroll, property use, rental activity, deposits, or a personal deduction. A useful response should be organized around the audit question. It should explain the calculation and lead CRA to the documents that support it instead of sending a broad group of files without context.

Tax Help Canada helps Streetsville residents, professionals, contractors, business owners, landlords, property owners, and families manage CRA audit files. We review scope, organize evidence, prepare reconciliations and explanations, communicate with CRA, and help assess proposals or reassessments before deadlines make the file more difficult.

Start by understanding what CRA is testing

CRA may ask for statements, invoices, receipts, contracts, GST/HST returns, payroll reports, property documents, or a written explanation. A deposit review can test income. A property question can concern rent, personal use, repairs, or a capital improvement. A request about worker payments can concern payroll deductions or contractor classification.

Professional and business records can include client invoices, sales, customer payments, vehicles, equipment, expenses, payroll, and GST/HST. Rental files can include leases, deposits, financing, taxes, insurance, repairs, and personal-use history. This first review identifies missing documents early enough to request them from banks, suppliers, clients, tenants, property managers, former bookkeepers, or online portals.

Reconcile income, deposits, and GST/HST

CRA may compare return income with invoices, deposits, payment reports, GST/HST filings, and third-party information. A deposit is not automatically income. It may be business revenue, rent, tax collected, a transfer, loan proceeds, reimbursement, refund, or money received for another person. Material amounts should be traced to credible records.

We prepare schedules linking 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 supporting evidence. This helps explain why gross sales, bank deposits, and GST/HST may not match line by line.

Expenses must receive equal attention. Vehicles, equipment, home office, supplies, travel, repairs, property costs, and payments to workers need proof and an income-earning purpose. Where an expense has personal use, the allocation should be reasonable and documented.

Consider every connected tax account

An audit may begin with a personal return but affect business banking, GST/HST, payroll, corporate records, rental activity, and other personal reporting. A sole proprietor’s sales should fit deposits and GST/HST. An incorporated owner may have payroll, shareholder transactions, expenses, and personal income. Property costs should fit the actual rental and personal use.

We look for these connections before detailed submissions are made. A deposit explanation should agree with the books and GST/HST. Worker payments should fit payroll and expense records. This reduces inconsistent answers and helps identify potential tax, interest, penalties, payment, and collections exposure.

Rebuild incomplete records from credible sources

Older records can be incomplete after a bank change, lost receipt, unavailable supplier, 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 aim is the best accurate evidence available, not an unsupported estimate.

The reconstruction should show its method. Sales can be tied to invoices and deposits, expenses to statements and vendor records, and rent to lease and banking history. This gives CRA a practical way to test the explanation.

Keep CRA communication and deadlines controlled

CRA may follow up by phone, letter, email, meeting, or secure upload. We help prepare written submissions identifying the audit question, facts, calculation, and evidence, while keeping a log of requests and responses. If historic statements, duplicate invoices, payroll reports, or property documents are still being collected, that 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 while there is still time to respond. Once reassessed, objection deadlines, interest, penalties, payment arrangements, and collections concerns may follow.

Get a clear audit plan

If CRA has contacted you about a Streetsville 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 requiring explanation. From there, you can respond with an organized plan grounded in evidence.