If the CRA sends you an audit notice, the first step is to read it carefully and note the deadline for your response, which is typically 30 days. The CRA may be asking for additional information about income, deductions, or credits you claimed on your tax return. Don't panic: an audit notice doesn't automatically mean you've done something wrong. It simply means the CRA wants to verify that your tax return is accurate. When you receive an audit notice, also known as a "Request for Information" or "Notice of Assessment," the CRA will specify exactly which years and which items they're reviewing. They'll also tell you what documents they need to see. Your job is to gather those documents, organize them clearly, and submit them before the deadline. The specific documents depend on what's under review. However, common requests include: Receipts and invoices for claimed business expenses Loan statements or mortgage paperwork for interest deductions Medical receipts and invoices for medical expense claims Childcare receipts and provider information for childcare deductions Donation receipts for charitable contributions Bank statements showing income deposits Home office calculations and utility bills Investment statements showing capital gains or losses If you're self-employed and claiming home
The CRA typically gives you 30 days from the date of the notice to respond with the requested documents. However, this timeline may be extended if you request more time or contact the CRA office listed on your notice.
If you don't respond within the deadline, the CRA may proceed with the audit using only the information they have on file. This could result in reassessments, additional taxes owed, penalties, and interest charges.
You can represent yourself in an audit, but hiring a tax professional, accountant, or lawyer is optional. Many Canadians find professional representation helpful, especially for complex audits or when dealing with business income.
No. The CRA reassessment notice will include payment terms. You can also request a payment arrangement if you cannot pay in full. However, interest will continue to accrue on any unpaid balance.
A Notice of Assessment is an annual document summarizing your tax return, deductions, and any refunds or amounts owing. An audit is a separate process where the CRA investigates specific items on your return in detail, which may result in a reassessment.