CRA Corporate Income Tax Audit — Montreal CPA Firm Near You: Large-File, High-Stakes Defense

A CRA Corporate Income Tax Audit is a comprehensive review of a corporation’s financial statements, tax returns, intercompany transactions, and accounting systems. These audits target medium and large corporations with complex structures, multi-entity operations, significant deductions, or recurring losses.
Mackisen CPA Montreal defends corporations during these high-stakes audits by reconstructing financial records, validating deductions, analyzing intercompany flow, and providing CPA-certified evidence that withstands CRA scrutiny.

Corporate audits require both technical tax expertise and forensic accounting discipline, because CRA examines not just the numbers — but how those numbers were created, approved, and justified.

Legal Foundation

Income Tax Act s.231.1 — allows CRA to inspect and demand corporate records.
Income Tax Act s.152(7) — CRA may reassess income regardless of what is filed if evidence is incomplete.
Income Tax Act s.247 — governs transfer pricing and related-party transactions.
Jurisprudence: General Motors of Canada (2008 FCA) — CRA can adjust intercompany transactions that lack commercial substance or fair-market pricing.

Learning insight: CRA asks one guiding question — “Do the numbers reflect commercial reality?”
Your CPA’s job is to prove that they do.

Why CRA Targets Corporate Entities

Corporate audits are triggered by risk indicators such as:
• large or unusual management fees
• intercompany loans lacking agreements
• recurring losses in profitable industries
• aggressive CCA (depreciation) claims
• significant repairs reclassified as capital
• unreported shareholder benefits
• high SR&ED tax-credit claims
• GST/HST inconsistencies with T2 filings
• unexplained variances across years

Learning insight: Corporations are not audited for being profitable — they’re audited for being complex.

CRA’s Corporate Audit Process

1. Audit notice identifying tax years and required documents

2. Review of financial statements, general ledgers, agreements, and minute books

3. CRA interviews with financial controllers or company officers

4. Transaction testing on revenue, CCA, payroll, and related-party charges

5. Verification of GST, payroll, and corporate tax alignment

6. Proposed reassessment (Section 30 letter)

7. CPA response with evidence, reconstructions, and legal arguments

8. Final reassessment or clearance

Learning insight: CRA auditors do not guess — they test. Your CPA must respond with documentation, not explanations.

Mackisen CPA’s Corporate Audit Defense Strategy

• full ledger reconstruction to match CRA test procedures
• validation of all significant deductions with invoices and contracts
• preparing intercompany transfer-pricing narratives and benchmarking
• analyzing shareholder loans, benefits, and T5/T4 reporting
• defending CCA claims under Income Tax Regulations 1100–1102
• preparing SR&ED substantiation where applicable
• representing the corporation in every communication with CRA
• preparing formal objections if CRA proposes unjustified reassessments

Learning insight: CRA audits rely on assumptions. CPA defense replaces assumptions with facts.

Common Corporate Audit Adjustments

• disallowed management fees lacking service proof
• shareholder benefits added to income
• denied SR&ED credits due to insufficient technical documentation
• repairs reclassified as capital additions
• transfer-pricing adjustments on intercompany service fees
• denied meals, travel, or marketing expenses
• foreign-exchange adjustments and missing T1134/T106 disclosures

Learning insight: The costliest adjustments come from missing documentation — not tax strategy.

Real-World Results

• A manufacturing corporation avoided a $1.1M reassessment after Mackisen CPA proved intercompany cost allocations and provided OECD pricing support.
• A transportation firm reversed $260,000 in disallowed expenses after we reconstructed vendor agreements and provided board-resolution evidence.
• A professional corporation reduced a proposed SR&ED denial by 85% with rewritten project narratives and substantiated experiments.

Learning insight: CRA adjusts aggressively until confronted with structured, professional documentation.

SEO Optimization and Educational Value

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Secondary keywords: transfer pricing audit, corporate ledger reconstruction, SR&ED tax audit defense, CRA corporate compliance Montreal

Learning insight: SEO works like CRA — it rewards clarity, authority, and structure. This article is built for both.

Why Mackisen CPA Montreal

With over 35 years of experience, Mackisen CPA Montreal is one of Québec’s leading corporate audit-defense firms. We combine tax-law interpretation, financial-forensic reconstruction, and strategic communication with CRA to protect corporations from unnecessary tax exposure.
Our bilingual team ensures every schedule, every deduction, and every intercompany relationship is documented, defensible, and audit-ready.

Learning insight: Corporations succeed with structure — and succeed even more when that structure is CPA-defended.

Call to Action

If CRA has issued a corporate audit notice or requested financial documentation, respond strategically — not reactively.
Contact Mackisen CPA Montreal today for large-file audit defense, corporate compliance review, and CRA negotiation.
Phone: 514-276-0808 | Email: info@mackisen.com | Website: mackisen.com

Learning conclusion: A CRA Corporate Income Tax Audit tests transparency, structure, and commercial logic. Mackisen CPA Montreal ensures your corporation passes on all three — transforming audit pressure into organized, well-defended compliance.