A CRA audit needs a record that explains the reported position
Thorold taxpayers may receive a CRA audit request involving a contractor, local business, rental property, GST/HST, payroll, personal banking, or a deduction claimed on a return. The supporting documents may be spread across invoices, statements, receipts, contracts, property files, payment platforms, email, and accounting software. CRA may see a reported amount or bank deposit without seeing the transaction and business facts behind it.
The audit letter normally identifies the years under review, account, records requested, CRA contact, and deadline. It may test income, expenses, GST/HST, payroll, property use, rental activity, deposits, or a personal claim. A useful response should focus on the issue CRA is testing. It explains how the figures were calculated and directs the auditor to the records supporting them.
Tax Help Canada helps Thorold residents, 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 create additional pressure.
Identify CRA’s specific question first
CRA may request bank statements, invoices, receipts, contracts, GST/HST returns, payroll reports, property documents, or a written explanation. A deposit review can test reported income. A property question can concern rent, personal use, repairs, or a capital improvement. A worker-payment request may concern payroll deductions or contractor classification.
Business and contractor files can include agreements, customer invoices, payments, vehicles, equipment, expenses, payroll, and GST/HST. Rental records may include leases, deposits, financing, taxes, insurance, repairs, and personal-use history. This first review identifies missing items early enough to request them from banks, suppliers, clients, property managers, former bookkeepers, or online accounts.
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 does not automatically represent income. It may be business revenue, rent, tax collected, a transfer, loan proceeds, reimbursement, refund, or money received for another person. Significant amounts should have a credible 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, bank deposits, and GST/HST may not match line by line.
Expenses need the same care. Vehicles, equipment, home office, supplies, travel, repairs, property costs, and payments to workers need evidence and an income-earning purpose. Where personal use exists, a reasonable allocation should be documented.
Related accounts must give CRA a consistent answer
An audit may begin with a personal return but reach 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 consider these connections before detailed explanations are sent. A deposit explanation should agree with 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 receipts, unavailable suppliers, a closed online account, or a former adviser. Bank and card statements, suppliers, clients, 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.
Control communication and the response deadline
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 Thorold audit, a confidential review can make the next step manageable. We will review the years and accounts, CRA’s questions, available evidence, and the business, property, rental, or personal facts requiring explanation. From there, you can respond with an organized plan grounded in evidence.