CRA Audit Reassessment for Small Businesses 2025 — Reverse Tax Errors, Stop Penalties, and Protect Your Company

For small business owners, a CRA audit reassessment can feel devastating. In 2025, CRA’s data-driven audit programs target small and medium enterprises more aggressively than ever — using AI to compare your filings against industry averages, bank deposits, and payroll submissions. Even a small discrepancy can trigger a reassessment that demands thousands in back taxes, penalties, and interest.

The truth? Most reassessments contain CRA calculation or interpretation errors — and can be successfully challenged. At Mackisen CPA Auditors Montreal, we defend small businesses against unfair reassessments. Our CPA auditors and tax lawyers analyze every line of CRA’s findings, identify errors, and file structured Notices of Objection and Taxpayer Relief Applications to reverse penalties and restore your company’s compliance.

We don’t let CRA redefine your success — we defend the business you’ve built.

Legal and Regulatory Framework

Income Tax Act (Canada)

• Section 152(4): Authorizes CRA to reassess prior returns within the normal period (usually three years) — but only when justified.

• Section 165(1): Gives taxpayers the right to file a Notice of Objection within 90 days.

• Section 220(3.1): Allows CRA to cancel or reduce penalties and interest under the Taxpayer Relief Program.

• Section 161(1): Accrues daily interest on unpaid balances until reassessment is overturned or settled.

Tax Administration Act (Quebec)
Revenu Québec mirrors CRA’s reassessment process and often issues parallel provincial audits. Mackisen coordinates both agencies for consistent defense and maximum relief.

Key Court Decisions

Venne v. The Queen (1984): CRA reassessments can be reversed if the taxpayer presents proper documentation.
Thibault v. The Queen (2022): Professional representation leads to higher success in objections and appeals.
Guindon v. Canada (2015): Penalties must be justified by negligence or omission — not simple errors.
Bédard v. The Queen (2022): Small businesses can overturn CRA reassessments by providing credible, organized evidence.

These cases prove that CRA’s reassessment is not the end — it’s just the beginning of your defense.

Why Small Businesses Are Targeted

CRA views small businesses as high-risk due to manual recordkeeping, mixed personal/business expenses, and cash-heavy transactions. Common 2025 audit triggers include:

• High expense-to-revenue ratios.

• Inconsistent GST/HST or QST filings.

• Repeated losses over multiple years.

• Missing invoices or bookkeeping irregularities.

• Discrepancies between business income and personal spending.

CRA assumes the worst — but Mackisen proves the truth.

Mackisen’s Small Business Audit Reassessment Defense Strategy

1. Audit File Review: Obtain CRA’s internal reassessment notes and audit trail for full transparency.

2. Evidence Reconstruction: Rebuild financial statements, invoices, and logs to correct CRA assumptions.

3. Legal Objection Filing: File a Notice of Objection within 90 days to stop enforcement.

4. Taxpayer Relief Request: Submit applications for penalty and interest cancellation under Section 220(3.1).

5. Negotiation and Settlement: Engage CRA Appeals to achieve balance reductions or reassessment reversals.

Our strategy combines audit precision, legal advocacy, and business insight — giving your company a strong, credible defense.

Real Client Experience

A Montreal marketing agency was reassessed $76,000 for alleged unreported income. Mackisen proved the deposits were client reimbursements — CRA reversed the reassessment in full.
A Quebec construction firm was issued $128,000 in payroll-related reassessments. Mackisen provided reconciled records and negotiated a 70% reduction in penalties and interest.

Common Questions

How long does CRA have to reassess my business? Three years from the original assessment date (ten if fraud or misrepresentation is alleged).
What if I miss the 90-day objection deadline? Mackisen can request an extension with legal justification.
Can CRA audit both federal and Quebec returns? Yes — but Mackisen handles both agencies to prevent duplicate assessments.
Can I keep operating during the audit? Absolutely — Mackisen manages CRA communications so you can stay focused on your business.

Why Mackisen

At Mackisen CPA Auditors Montreal, we protect small businesses from the heavy hand of CRA. Our team brings decades of experience in audits, appeals, and tax litigation — fighting for fair treatment and accurate results.

We defend your business with facts, law, and precision — because every small business deserves a big defense.

Call Mackisen CPA Auditors Montreal today for your 2025 Small Business Reassessment Consultation. The first meeting is free, and your protection starts immediately.