CRA GST/HST Audit Defense 2025 — Protect Your Business, Recover Your Credits, and Stop CRA Reassessments

A CRA GST/HST audit can cripple a business if not handled properly. In 2025, CRA’s audit algorithms instantly detect inconsistencies between GST/HST filings, income statements, and supplier transactions. Once flagged, CRA auditors often deny Input Tax Credits (ITCs), reassess several years of returns, and charge penalties with compounded daily interest. For small and mid-sized businesses, these audits can mean tens or even hundreds of thousands of dollars in losses. But with expert representation, your audit can be controlled, defended, and even reversed. At Mackisen CPA Auditors Montreal, we specialize in defending GST/HST audits. Our CPA auditors and tax lawyers identify errors in CRA’s assumptions, prepare legal responses, and ensure that your credits, expenses, and documentation are fully validated. We don’t let CRA decide your tax future — we defend it.

Legal and Regulatory Framework

Excise Tax Act (Canada)

• Section 225: Entitles businesses to claim Input Tax Credits (ITCs) on business expenses.

• Section 286: Requires detailed books and records to support ITC claims.

• Section 296: Grants CRA audit and reassessment authority — and allows you to object.

• Section 299: Protects taxpayers’ rights to appeal unfair GST/HST reassessments.
  Tax Administration Act (Quebec)
  Revenu Québec conducts QST audits under similar provisions, often sharing information with CRA. Mackisen defends both audits simultaneously to prevent duplication or double reassessment.

Key Court Decisions

North Shore Power Group v. The Queen (2018): CRA must consider all available evidence proving valid ITCs.
Bédard v. The Queen (2022): Missing invoices do not automatically invalidate ITCs if the business use is proven.
Les Entreprises XY v. The Queen (2020): CRA must evaluate good faith and supplier verification before denying credits.
Guindon v. Canada (2015): Penalties may be waived through proper defense and relief applications.
These rulings confirm that CRA’s audit outcomes can be overturned with proper evidence and expert advocacy.

Why CRA Targets GST/HST Audits

CRA focuses heavily on GST/HST compliance because it’s one of the easiest areas for small business errors. Common 2025 audit triggers include:

• Frequent refund claims or high ITC ratios.

• Missing or incomplete supplier invoices.

• Differences between GST/HST returns and income filings.

• Claims involving non-registered suppliers.

• Unusual spikes in expenses or purchases.
  Most GST/HST audits are based on automated data mismatches — not fraud. Mackisen ensures CRA sees the full picture, not a computer-generated assumption.

Mackisen’s GST/HST Audit Defense Strategy

1. Pre-Audit Preparation: Review CRA’s audit notice and identify potential risk areas before engagement.

2. Documentation Reconstruction: Rebuild missing invoices, contracts, and payment evidence.

3. Direct Representation: Handle all communication and audit meetings to prevent misstatements or overreach.

4. Dispute and Appeal: Challenge CRA’s findings, file formal objections, and recover denied credits.

5. Post-Audit Relief: Request cancellation of penalties or interest under the Taxpayer Relief Program.
   Our process is proactive, factual, and proven — minimizing exposure while protecting every legitimate credit.

Real Client Experience

A Montreal construction company was reassessed $142,000 for denied GST/HST ITCs. Mackisen reconstructed supplier records and proved business use — CRA reversed the entire assessment.
A Quebec manufacturer faced a $63,000 reassessment after a joint CRA/Revenu Québec audit. Mackisen negotiated directly with both agencies and achieved a 75% reduction in total debt.

Common Questions

Can CRA deny ITCs without proof of fraud? Yes, but Mackisen can appeal denials with documentation and legal arguments.
How far back can CRA audit GST/HST? Usually four years, but longer if CRA alleges negligence.
What if I can’t find all invoices? We can rebuild evidence through supplier verification and bank statements.
Can I recover ITCs after reassessment? Yes, if we prove eligibility through objections or appeals.

Why Mackisen

At Mackisen CPA Auditors Montreal, we know how to dismantle CRA’s audit logic and protect what your business has earned. Our dual CPA–tax lawyer team understands both the accounting and legal angles of GST/HST audits, giving you a complete, unbeatable defense. We act fast, argue strategically, and defend relentlessly — because your compliance deserves respect, not penalties.
Call Mackisen CPA Auditors Montreal today for your 2025 GST/HST Audit Defense Consultation. The first meeting is free, and your protection starts immediately.