CRA GST/HST Audit 2025 — Defend Your Business, Reverse Denied Credits, and Stop CRA Penalties with Mackisen CPA

In 2025, CRA’s GST/HST Audit Division is running one of the most aggressive compliance campaigns in Canadian history. Using digital tracing and AI-powered data matching, CRA is auditing businesses for input tax credit (ITC) claims, unreported sales, and late remittances. Even legitimate companies are being hit with heavy reassessments because of minor bookkeeping errors or missing invoices. CRA’s system assumes every inconsistency is non-compliance — freezing refunds, adding interest, and applying penalties instantly. At Mackisen CPA Auditors Montreal, we defend businesses from CRA’s GST/HST audits, rebuild documentation, and recover denied ITCs. Our CPA auditors and tax lawyers expose CRA errors, negotiate settlements, and ensure your business remains financially secure. We don’t let CRA’s automation punish your compliance — we turn audits into victories.

Legal and Regulatory Framework

Excise Tax Act (Canada)

• Section 169(1): Grants entitlement to Input Tax Credits for GST/HST paid on legitimate business expenses.

• Section 225(1): Sets out the reporting and remittance periods for registrants.

• Section 296(1): Allows CRA to reassess GST/HST filings but requires proof of ineligibility before denying ITCs.

• Section 280(1): Imposes interest on unpaid tax, which can be waived under Section 220(3.1) of the Income Tax Act through the Taxpayer Relief Program.
  Tax Administration Act (Quebec)
  Revenu Québec enforces QST audits parallel to CRA’s GST/HST audits. Mackisen manages both jurisdictions to ensure coordinated defense and consistent results.

Key Court Decisions

Les Entreprises Bédard Inc. v. The Queen (2022): CRA cannot deny ITCs for technical or formatting errors if a valid business transaction occurred.
Thibault v. The Queen (2022): Taxpayers acting in good faith and keeping reasonable records are entitled to full ITC recovery.
Guindon v. Canada (2015): Penalties must be supported by evidence of negligence — not administrative delay.
Jordan v. The Queen (2009): CRA must evaluate compliance fairly and cannot impose penalties based solely on assumption.
These precedents confirm that CRA must respect your right to claim legitimate GST/HST credits and refunds.

Why CRA Targets GST/HST Registrants

CRA’s audit focus in 2025 is on industries with frequent cash transactions or large ITC claims. Common triggers include:

• Excessive or recurring refund requests.

• Missing or incomplete invoices.

• Late GST/HST remittances or payments.

• Supplier not registered for GST/HST.

• Mismatch between income tax and GST/HST filings.
  CRA assumes error — Mackisen proves eligibility and accuracy.

Mackisen’s GST/HST Audit Defense Strategy

1. Audit File Review: Examine CRA’s reassessment notice and identify weaknesses in their findings.

2. Evidence Reconstruction: Rebuild invoice, receipt, and payment records to substantiate all ITC claims.

3. Legal and Financial Defense: Demonstrate business purpose, supplier registration, and fair reporting under the Act.

4. Formal Objection Filing: Submit a Notice of Objection to suspend CRA collection and contest the reassessment.

5. Penalty & Interest Relief: Apply under Section 220(3.1) for full or partial cancellation of financial penalties.
   Our approach turns CRA’s one-sided audit into a documented and defensible compliance file.

Real Client Experience

A Montreal manufacturing firm was denied $286,000 in ITCs for “improper invoices.” Mackisen reconstructed supplier documentation and CRA reinstated the full refund.
A Quebec retailer was penalized $112,000 for “late remittances.” Mackisen demonstrated CRA system delay and secured full penalty reversal.

Common Questions

Can CRA audit both GST and QST at once? Yes — Mackisen coordinates defense across both agencies to prevent duplication.
Can CRA deny ITCs for missing supplier GST numbers? Only temporarily — Mackisen corrects documentation and recovers your credits.
Can CRA freeze my GST refund? Yes, but Mackisen ensures immediate release through objection and appeal.
Can CRA remove penalties after an audit? Absolutely — Mackisen secures relief under the Taxpayer Relief Program.

Why Mackisen

At Mackisen CPA Auditors Montreal, we are Canada’s leaders in GST/HST and QST audit defense. Our integrated team of CPAs and tax lawyers ensures every ITC, deduction, and refund you claim is defended with precision. We act quickly, document thoroughly, and fight strategically — because fair taxes shouldn’t become financial punishment. When CRA audits your GST/HST, Mackisen audits their accuracy.
Call Mackisen CPA Auditors Montreal today for your 2025 GST/HST Audit Defense Consultation. The first meeting is free, and your protection starts immediately.