CRA Director Liability Audit — Montreal CPA Firm Near You: Shield Your Personal Assets

A CRA Director Liability Audit can turn a corporate tax issue into a personal financial crisis. When a corporation fails to remit payroll deductions, CPP/EI, GST/HST, or QST, the Canada Revenue Agency (CRA) and Revenu Québec can pursue directors personally for those amounts. This power extends even after the company dissolves or goes bankrupt. Mackisen CPA Montreal provides professional representation, documentation, and legal coordination to protect directors from personal assessments — proving due diligence and preventing enforcement actions.

Legal Foundation

Law: Income Tax Act s. 227.1 — director liability for unremitted source deductions; Excise Tax Act s. 323 — liability for unpaid GST/HST; Tax Administration Act (Québec) arts. 40–44 — parallel provisions for QST and source deductions.
Jurisprudence: Soper v. Canada (1997 FCA) — established that directors can avoid personal liability by proving they took all reasonable steps to ensure remittances were made.

Learning insight: CRA doesn’t need to prove intent — only omission. Your CPA must prove action, oversight, and diligence.

Why CRA Targets Directors

When corporations fail to remit trust funds such as payroll or GST/HST, CRA assumes that directors had control and failed to act. These trust funds legally belong to the Crown, not the corporation. Directors — including those listed on resolutions or signing authorities — can be assessed personally within two years of ceasing their role.

CRA typically issues Director Liability Notices (DLNs) when:

• Payroll remittances are missed or delayed for multiple months.

• GST/HST or QST filings show balances unpaid after assessment.

• Corporate bankruptcy filings omit CRA priority claims.

• No evidence exists of director oversight or financial management.

Learning insight: Signing one corporate cheque makes you a fiduciary. Mackisen CPA ensures your signature doesn’t turn into a summons.

What Mackisen CPA’s Director Liability Defense Includes

1. Corporate Record Review — Analyzing remittance records, bank ledgers, and tax accounts to establish facts.

2. Due-Diligence File Creation — Documenting meeting minutes, financial reports, and actions proving oversight.

3. Resignation and Timing Verification — Confirming resignation dates to protect from post-tenure assessments.

4. CRA Negotiation — Engaging with Collections and Legal Services to challenge or settle liability claims.

5. Legal Coordination — Working with tax lawyers under privilege to build a comprehensive defense.

Learning insight: CRA pursues silence — documentation stops it in its tracks.

Common Triggers for Director Liability Audits

• Corporate tax arrears or late remittances.

• Insolvency or bankruptcy filings with outstanding trust taxes.

• Failure to maintain or provide corporate records.

• Disputes between shareholders or directors leading to lost control.

• Directors unaware of CRA payroll or GST/HST enforcement actions.

Mackisen CPA Montreal reconstructs financial timelines and corporate communication to show that you acted responsibly — even under financial strain.

Learning insight: CRA’s version of negligence is simply inaction. Mackisen CPA turns your actions into legal proof of diligence.

Financial and Legal Risks of Inaction

If CRA finalizes a Director Liability Notice, it can enforce collection through:

• Wage garnishments or bank-account seizures.

• Liens on personal property or real estate.

• Denial of future CRA payment arrangements or tax clearance certificates.

Penalties and interest accrue continuously until the assessment is resolved or appealed.

Learning insight: Ignoring a DLN doesn’t buy time — it eliminates your options. Mackisen CPA ensures your defense starts before CRA enforcement does.

How Mackisen CPA Protects You

• Conducts a forensic review of all CRA/ARQ remittance accounts.

• Prepares formal due-diligence submissions under s. 227.1(3) ITA.

• Establishes a chronology proving directors acted in good faith.

• Negotiates settlements or penalty relief where miscommunication occurred.

• Provides post-audit compliance planning to prevent recurrence.

Learning insight: Director liability isn’t a tax issue — it’s a proof issue. Mackisen CPA builds the proof that keeps you safe.

SEO Optimization and Learning Value

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Learning insight: CRA collects from those who can pay, not just those who owe. Mackisen CPA ensures you never appear on that list.

Real Client Success

• A Montréal restaurant owner avoided a $78,000 personal reassessment when Mackisen CPA proved that all remittance failures occurred after resignation.

• A manufacturing CEO was cleared of liability for $210,000 in payroll taxes after our team documented consistent payment efforts during financial hardship.

• A construction director negotiated a 90% penalty reduction following Mackisen CPA’s submission of due-diligence evidence and correspondence logs.

Learning insight: The best director defense isn’t legal argument — it’s documentation that shows responsibility in real time.

Why Mackisen CPA Montreal

Mackisen CPA Montreal is Québec’s trusted expert in director liability defense and corporate tax audit representation. With over 35 years of combined experience, our bilingual CPA team has defended hundreds of directors and shareholders in CRA and Revenu Québec audits. We combine legal diligence, forensic accounting, and transparent communication to protect both your corporate records and personal finances.

Learning insight: CRA looks for liability — Mackisen CPA finds logic. We turn your history into your strongest defense.