CRA Transfer Pricing Audit — Montreal CPA Firm Near You: OECD-Aligned Defense Files

A CRA Transfer Pricing Audit examines whether your company’s cross-border transactions between related entities are conducted at arm’s length — the same way independent parties would deal with each other. These audits typically target multinational or group-owned businesses that buy, sell, lend, or license goods, services, or intellectual property across jurisdictions.
Mackisen CPA Montreal builds complete OECD-aligned defense files to protect your intercompany pricing strategy and ensure compliance with section 247 of the Income Tax Act.

Legal Foundation

Law: Income Tax Act s.247 (Transfer Pricing Rules); OECD Transfer Pricing Guidelines (2022 Edition).
Jurisprudence: GlaxoSmithKline Inc. v. Canada (2012 SCC) — CRA must assess pricing based on commercial and economic substance, not just contractual form.

Learning insight: CRA doesn’t judge how much you charged — it judges whether an independent business would agree to it. Mackisen CPA makes sure the answer is yes.

Why CRA Conducts Transfer Pricing Audits

CRA’s Transfer Pricing Review Division targets companies with significant related-party activity or large intercompany charges. Typical triggers include:

• Management or technical service fees charged between subsidiaries.

• Intercompany loans with non-market interest rates.

• Royalties or licensing fees for trademarks and intellectual property.

• Cost-sharing or R&D allocations without clear methodology.

• Persistent losses in Canadian subsidiaries with profitable foreign parents.

Learning insight: CRA audits where profit flows across borders. Mackisen CPA ensures that flow is legal, logical, and well-documented.

How CRA Conducts a Transfer Pricing Audit

1. Risk Assessment: CRA reviews T106 filings and financial statements for related-party transactions.

2. Information Request: CRA demands contemporaneous documentation — functional analysis, comparables, and transfer-pricing studies.

3. Functional & Economic Analysis: CRA evaluates who performs which functions, owns which assets, and assumes which risks.

4. Benchmark Testing: CRA compares your pricing to market comparables or OECD datasets.

5. Adjustment & Penalty Assessment: CRA may adjust income or apply 10% penalties under s.247(3) if documentation is missing.

Learning insight: CRA expects economic logic. Mackisen CPA ensures your data and documentation tell that story perfectly.

Mackisen CPA’s Transfer Pricing Defense Framework

1. Functional Analysis: Define how each entity adds value (functions, assets, risks).

2. Comparability Benchmarking: Identify arm’s-length pricing using independent market data.

3. Economic Study Preparation: Apply OECD-approved methods — CUP, TNMM, Cost-Plus, or Resale Price.

4. Intercompany Documentation: Create contemporaneous Master File and Local File per OECD BEPS standards.

5. CRA Negotiation: Present evidence proactively, minimizing audit duration and exposure.

Learning insight: CRA challenges vague pricing models — Mackisen CPA turns them into documented financial logic.

Common Issues in CRA Transfer Pricing Audits

• Lack of contemporaneous documentation.

• Inconsistent reporting of intercompany transactions across T106 and T2 filings.

• Cross-border loans with non-market interest.

• Cost-sharing without benefit analysis.

• Royalties charged to loss-making subsidiaries.

Mackisen CPA’s bilingual CPA and tax-law team resolves these issues by aligning pricing, contracts, and accounting with CRA’s international standards.

Learning insight: CRA’s data is global — your defense must be too. Mackisen CPA provides that global compliance perspective.

Real Client Success

• A Montréal manufacturer avoided a $1.4M reassessment after Mackisen CPA proved its U.S. management fees reflected fair-market services under OECD TNMM benchmarks.

• A technology company reduced CRA adjustments by 90% after we prepared a contemporaneous Local File and supporting comparables.

• A pharmaceutical group eliminated penalties when we demonstrated that royalties reflected intellectual-property contribution, not tax avoidance.

Learning insight: CRA doesn’t penalize profits — it penalizes poor proof. Mackisen CPA builds the documentation that passes every audit.

SEO Optimization and Learning Value

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Secondary Keywords: CRA intercompany audit, transfer pricing penalty Canada, Mackisen CPA defense file, OECD BEPS compliance, CRA cross-border audit.

Learning insight: CRA rewards structure, and Google rewards authority — Mackisen CPA builds both through documented expertise.

Why Mackisen CPA Montreal

Mackisen CPA Montreal brings over 35 years of combined audit and tax-law experience in global compliance and cross-border taxation. Our bilingual CPAs prepare OECD-standard documentation and negotiate directly with CRA’s Transfer Pricing Division.
We don’t just defend your intercompany pricing — we legitimize it through clear economic reasoning and robust financial analysis.

Learning insight: Transfer pricing isn’t about tax strategy — it’s about economic storytelling. Mackisen CPA ensures your story is compliant, credible, and complete.

Call to Action

If CRA or Revenu Québec has requested your transfer-pricing documentation or issued a related-party information request (T106), act immediately.
Contact Mackisen CPA Montreal for a full OECD-aligned transfer pricing defense and compliance audit.
Phone: 514-276-0808 | Email: info@mackisen.com | Website: mackisen.com

Learning conclusion: CRA Transfer Pricing Audits test fairness and form. Mackisen CPA Montreal ensures your cross-border pricing reflects both — arm’s-length, compliant, and bulletproof.