Aggressive tax planning by wealthy individuals and complex business structures poses a significant challenge to the integrity of Canada’s tax system. In response, the Canada Revenue Agency (CRA) has bolstered its compliance arsenal, including the creation of specialized audit units. Foremost among these is the High Complexity Audit Tax Services Office (TSO) (also known as HCATSO) – a dedicated office within the CRA focused on the most complex and high-risk tax file…
If you’re a corporate director in Canada, you could face personal liability for certain unpaid tax debts of your company. The Canada Revenue Agency (CRA) can assess directors personally for unremitted GST/HST and payroll source deductions (income tax, CPP, EI) under section 227.1 of the Income Tax Act (Canada) (ITA) and section 323 of the Excise Tax Act (Canada) (ETA). However, there is an important safeguard for responsible directors: the due diligence defence. Th…
Introduction and Objective
The Canada Revenue Agency’s Related Party Initiative (RPI) is a specialized compliance program targeting high-net-worth taxpayers and their interconnected entities. The RPI’s core objective is to identify, risk-assess, and take compliance action on instances of tax non-compliance among the wealthy and their related networks. In practice, this means the CRA examines entire groups of related parties – individuals, corporations, trusts, p…
The Canada Emergency Wage Subsidy (CEWS) and Canada Emergency Rent Subsidy (CERS) were lifelines for businesses during the COVID-19 pandemic. CEWS alone paid out about $100 billion to help employers cover wages. Now that the crisis has passed, the Canada Revenue Agency (CRA) is auditing those subsidy claims to ensure they were properly claimed. In many cases, these audits are leading to disputes with CRA auditors and appeals officers, and increasingly, in appeals t…