What is the CRA Audit Time Limit?
The CRA has a wide range of powers. Many people and businesses worry about a facing CRA audit. When potentially facing a audit, you might be asking "What is the CRA Audit Time Limit?" In general, the CRA has three years to audit your returns but thats not always the case.
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The CRA Audit Time Limit and How it Affects You
Nobody wants to be audited by the Canada Revenue Agency (CRA). The process is lengthy, time-consuming, confusing, and often very stressful. CRA negotiators are very experienced and they know which questions to ask and how to ask them to get the information they want. They also know how to use the power of the CRA to their benefit. Since this is true, it’s understandable that people want to avoid an audit and are interested in the CRA audit time limit to know when they are safe.
In general, the CRA audit time limit refers to how far back the CRA can audit your tax return. In general, the agency can audit a return up to three years after the return has been assessed or reassessed. However, if it has reason to believe that misrepresentation, fraud or negligence took place, then the CRA audit time limit can be extended back to returns as far as records allow.
If the agency has chosen to audit a return beyond the three years, they must be able to prove that misrepresentation, fraud or negligence took place.
Why the CRA Audit Time Limit Matters
If you are audited by the CRA, the agency will likely request that you give them all relevant documents, receipts, and records relating to your tax returns. For this reason, it is important that you keep all of these documents for at least six years. If the agency requests a document and you aren’t able to produce it, you could significantly hinder your own case. CRA auditors do not like to hear that you are unable to supply them with the information they are asking for. In the best-case scenario, not having the documents when auditors request them can lengthen the process and make it even more time-consuming and stressful. At worst, not being able to give the agency the information it needs can lead to an unfair audit result and one that will be incredibly difficult for you to argue without evidence.
If you receive notice that the CRA is planning to conduct an audit, you’ll want to make sure that you have all of your documents. You’ll also want to make sure that you have a professional on your side.
How We Can Help in a CRA Audit
If you’re being audited by the CRA, it helps to have professionals on your side. CRA auditors are very skilled and they know the process inside and out. If you go into an audit alone, you’re going in unprepared. The auditor will try to confuse and intimidate you into giving them information that they can use against you.
At Farber Tax Solutions, we provide a number of services to help you, no matter what stage of the audit process you may be in. We can communicate with CRA auditors on your behalf, help you prepare for interviews, and accompany you to any meetings with CRA employees or auditors.
We work to ensure that your rights are protected and that the audit is fair, and work to secure a more favourable audit outcome for you.
Our team is made up of experienced ex-CRA, legal, and accounting professionals. We are experienced in CRA audits and know how to navigate these complex processes successfully. Rather than worry about the CRA audit time limit or how you will answer the auditor’s questions, contact us instead. We will work with you throughout the entire audit process to make sure you are treated fairly.
Farber Tax Solutions can help you successfully deal with CRA problems. We utilize the experience of our tax experts to:
- 1| Offer a comprehensive solution that is focused on achieving the most favourable possible outcome for your tax issue;
- 2| Communicate with the CRA on your behalf and navigate the entire CRA dispute process; and
- 3| Offer a complete solution to your tax problems, including ex-CRA professionals and tax lawyers from Farber Tax Law.