ARQ Shareholder Loans/Dividends Audit — Montreal CPA Firm Near You: Stop Deemed Benefits

An ARQ Shareholder Loans/Dividends Audit (Vérification des avances ou prêts aux actionnaires) is one of the most common and high-risk corporate audits in Québec. Revenu Québec closely monitors shareholder withdrawals, advances, and inter-company transfers that may be deemed taxable benefits or disguised dividends. Mackisen CPA Montreal provides expert defense and reconciliation services to prevent these transactions from being reclassified as personal income, protecting you from double taxation and penalties.

Legal Foundation

Law: Taxation Act (Québec) ss. 21–22 (shareholder advances, loans, and benefits); Tax Administration Act art. 93 (audit and document requests).
Jurisprudence: Dubé v. ARQ (2007 CQ) — confirmed that shareholder advances must be supported by legitimate repayment intent and documented loan agreements; absence of proof leads to deemed-benefit taxation.

Why You Need a CPA for a Shareholder Loan Audit

Many business owners use corporate funds for personal cash flow—temporarily paying for personal expenses, mortgages, or vehicle costs. While common, these transactions can trigger reassessments if not properly documented. ARQ treats undocumented withdrawals as deemed dividends under TA s. 21 or as taxable income. Mackisen CPA Montreal structures, documents, and reconciles every shareholder loan to meet both accounting and tax standards.

Learning insight: Every shareholder withdrawal tells a story—without a CPA, ARQ writes the ending for you.

What Mackisen CPA’s Shareholder Loan Audit Defense Includes

• Full reconstruction of shareholder loan and capital accounts.

• Preparation of written loan agreements with fixed repayment terms.

• Calculation of interest benefits under prescribed-rate rules.

• Documentation of repayments and reclassifications under TA s. 22.

• CPA-certified reconciliation linking corporate books to CO-17 returns.

Learning insight: A shareholder loan is not taxable if it’s legitimate. Documentation turns intent into compliance.

Common Triggers for ARQ Shareholder Loan Audits

• Large advances to shareholders without repayment.

• Personal expenses (travel, cars, renovations) recorded as corporate costs.

• Inter-company loans without written contracts.

• Corporate books showing recurring “Due from Shareholder” balances.

• Year-end adjustments that reduce taxable income through withdrawals.

Mackisen CPA Montreal detects these risk indicators early and provides full legal and accounting support to prove valid corporate purpose and repayment capacity.

How Mackisen CPA Manages Shareholder Loan Audits

1. Conducts forensic reconciliation of general ledger accounts (Due from/to Shareholders).

2. Identifies and separates personal transactions from legitimate corporate expenditures.

3. Drafts loan agreements and repayment schedules to satisfy ARQ documentation requirements.

4. Recalculates interest benefits under prescribed rates and records adjusting entries.

5. Prepares CPA-signed audit binder demonstrating compliance under TA s. 21.

Learning insight: When ARQ questions intent, documentation answers with proof.

Benefits of Professional Representation

• Prevents shareholder advances from being reclassified as taxable income.

• Avoids 40–50% effective tax rate on deemed dividends.

• Restores compliance with TA ss. 21–22 for future fiscal years.

• Provides legal backing for repayment or forgiveness under proper elections.

• Strengthens corporate governance and loan management documentation.

Learning insight: In tax law, the difference between a benefit and a loan is one word—proof. Mackisen CPA builds that proof.

SEO Optimization and Learning Value

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Secondary Keywords: shareholder advance audit, deemed dividend defense, Mackisen CPA audit representation, CO-17 shareholder reconciliation, Québec corporate tax audit.

Learning insight: ARQ audits balances; CPAs defend intentions. The stronger your structure, the safer your strategy.

Real Client Success

• A Laval construction company avoided $115,000 in deemed-benefit taxation after Mackisen CPA proved all withdrawals were short-term shareholder loans with repayment proof.

• A professional service firm successfully reclassified personal expenses after our CPA team produced compliant written loan agreements.

• A family business cleared a three-year audit when Mackisen CPA reconciled dividends and capital accounts to historical earnings records.

Why Mackisen CPA Montreal

Mackisen CPA Montreal brings over 35 years of combined experience in corporate tax defense, financial reconstruction, and Revenu Québec compliance. We ensure your shareholder transactions are properly structured, supported, and compliant—protecting both your corporation and personal finances.

Learning insight: A shareholder loan isn’t risky—it’s misunderstood. Mackisen CPA gives it legal and financial clarity before ARQ gives it a tax bill.