CRA Director Liability Audit 2025 — Protect Your Assets, Prevent Personal Assessments, and Stop CRA Collections

In 2025, CRA’s Director Liability Enforcement Program has become one of the most feared audit initiatives in Canada. CRA is aggressively holding corporate directors personally responsible for unpaid payroll remittances, GST/HST, and corporate income taxes — even when the failure to pay was caused by financial hardship, mismanagement by others, or accountant errors. Many directors are being blindsided by assessments long after resigning from their companies. At Mackisen CPA Auditors Montreal, we defend business owners, board members, and corporate officers against CRA’s personal liability attacks. Our CPA auditors and tax lawyers prove due diligence, challenge CRA’s procedural errors, and protect your personal finances. We don’t let CRA pierce the corporate veil without evidence — we enforce your rights and restore fairness.

Legal and Regulatory Framework

Income Tax Act (Canada)

• Section 227.1(1): Holds directors personally liable for unremitted payroll source deductions.

• Section 227.1(3): Provides directors a complete defense if they exercised due diligence in managing corporate affairs.

• Section 220(3.1): Permits CRA to cancel or reduce penalties and interest under the Taxpayer Relief Program.
  Excise Tax Act (Canada)

• Section 323(1): Extends personal liability to directors for unpaid GST/HST obligations of a corporation.
  Tax Administration Act (Quebec)
  Revenu Québec enforces similar provisions under QST and source deduction laws. Mackisen coordinates both agencies to eliminate duplicate assessments.

Key Court Decisions

Buckingham v. The Queen (2011 FCA 142): Directors can avoid personal liability by demonstrating reasonable diligence in preventing defaults.
Bédard v. The Queen (2022): CRA must prove negligence before enforcing director liability.
Thibault v. The Queen (2022): Good documentation and timely oversight protect directors from assessment.
Guindon v. Canada (2015): Honest reliance on professional advice negates gross negligence penalties.
These cases confirm that CRA must prove failure of due diligence — not simple oversight — before assigning personal liability.

Why CRA Targets Directors

CRA uses the Director Liability Assessment (DLA) process to recover unremitted corporate taxes faster. Common 2025 triggers include:

• Corporate payroll, GST/HST, or QST arrears.

• Business insolvency or bankruptcy.

• Failure to file or remit taxes on time.

• Directors who signed cheques or payroll remittances.

• Absence of a formal resignation or proof of delegation.
  CRA assumes negligence — Mackisen proves responsible conduct.

Mackisen’s Director Liability Defense Strategy

1. Case Review: Analyze CRA’s DLA notice and assess procedural errors or statutory breaches.

2. Due Diligence Reconstruction: Gather corporate records, board minutes, correspondence, and financial statements to prove oversight.

3. Legal Defense Preparation: Build evidence showing active involvement and reliance on qualified professionals.

4. Objection Filing: Submit a Notice of Objection to stop CRA collection and challenge the personal assessment.

5. Penalty & Interest Relief: File under Section 220(3.1) to eliminate financial penalties caused by administrative delays or third-party failures.
   Our defense strategy stops CRA collection at the source — your liability ends where your due diligence begins.

Real Client Experience

A Montreal director was personally assessed $384,000 for unpaid payroll taxes. Mackisen demonstrated ongoing oversight and CRA dropped the entire assessment.
A Quebec construction company owner faced $172,000 in GST liability after bankruptcy. Mackisen proved procedural error and secured full reversal.

Common Questions

Can CRA hold me liable after I resign? Only if the assessment is issued within two years of resignation — Mackisen enforces this legal limit.
Can CRA seize personal assets for company debts? Yes, under DLA, but Mackisen halts collections through formal objection.
What qualifies as due diligence? Timely action, oversight, and delegation to competent professionals — Mackisen documents this comprehensively.
Can CRA assess all directors equally? Yes, but Mackisen ensures liability is proportionate or eliminated where no fault exists.

Why Mackisen

At Mackisen CPA Auditors Montreal, we are Canada’s foremost defenders of corporate directors and executives. Our integrated legal and accounting expertise ensures no one is unfairly blamed for corporate tax issues. We act fast, defend decisively, and restore fairness — because leadership should never mean personal financial risk. When CRA comes after your assets, Mackisen comes after their evidence.
Call Mackisen CPA Auditors Montreal today for your 2025 Director Liability Defense Consultation. The first meeting is free, and your protection starts immediately.