CRA GST/HST Compliance Audit — Montreal CPA Firm Near You: ITCs, Place of Supply

A CRA GST/HST Compliance Audit reviews how accurately your business collects, remits, and claims GST/HST on taxable supplies. The Canada Revenue Agency uses advanced data matching between suppliers, customers, and financial statements to ensure that the tax you collect and the credits you claim are correct and properly supported. Mackisen CPA Montreal provides professional audit representation and documentation defense, ensuring your Input Tax Credits (ITCs) and remittances align with the Excise Tax Act’s strict compliance standards.

Legal Foundation

Law: Excise Tax Act (ETA) ss. 165–169 — governs GST/HST calculation and ITC entitlement; ss. 286–289 — outlines documentation and record-keeping requirements.
Jurisprudence: Northwest Company Inc. v. Canada (2011 TCC) — confirmed that ITCs are valid only if the taxpayer holds proper documentary evidence showing the supplier’s registration, tax rate, and commercial purpose of purchase.

Learning insight: CRA doesn’t question your math — it questions your proof. Documentation is the difference between compliance and reassessment.

Why CRA Conducts GST/HST Audits

GST/HST is a self-reporting system built on trust, but CRA verifies that:

• The tax you collected was remitted on time.

• Your input tax credits (ITCs) were claimed on eligible business expenses.

• You used the correct place-of-supply rules for interprovincial transactions.

• Exempt and zero-rated supplies were properly classified.

CRA audit triggers include:

• Frequent refund claims or negative balances.

• Large ITC amounts relative to revenue.

• Missing supplier GST/HST registration numbers.

• Inconsistent remittance history or unfiled returns.

• Random selection through CRA’s Risk-Based Audit Program.

Learning insight: GST/HST compliance is not about tax avoidance — it’s about paperwork precision.

What Mackisen CPA’s GST/HST Audit Defense Includes

1. ITC Verification: We audit every supplier invoice for proper tax registration, name, and tax rate.

2. Remittance Reconciliation: Match GST/HST collected, remitted, and reported across CRA filings and general ledgers.

3. Place-of-Supply Testing: Ensure the right provincial rates were applied (5%, 13%, or 15%) for interprovincial transactions.

4. Mixed-Use Asset Review: Allocate personal versus commercial use for vehicles, property, or software.

5. Refund Defense: Compile CPA-certified documentation to accelerate CRA refund release.

Learning insight: CRA’s refund integrity officers check for eligibility; Mackisen CPA ensures every claim is bulletproof.

Common GST/HST Audit Mistakes

• Unregistered Suppliers: Claiming ITCs from suppliers without valid GST numbers.

• Improper Classification: Confusing exempt (no tax) and zero-rated (tax at 0%) supplies.

• Duplicate Claims: Re-entering ITCs across reporting periods.

• Cash Payments: Missing proof of payment or invoice documentation.

• Incorrect Rate Application: Misapplying place-of-supply rates for sales across provinces.

Mackisen CPA Montreal identifies and corrects these issues before the auditor requests documentation.

Learning insight: Every GST/HST reassessment starts with one missing line on an invoice. Mackisen CPA makes sure there are none.

How Mackisen CPA Handles CRA GST/HST Audits

1. Conducts a pre-audit compliance review of your general ledger, FPZ-500-V returns, and bank statements.

2. Reconciles collected versus remitted GST/HST for each reporting period.

3. Validates supplier documentation and tax-registration numbers through CRA databases.

4. Communicates directly with CRA auditors to clarify findings and resolve discrepancies.

5. Implements ongoing GST/HST filing controls to prevent future audits.

Learning insight: CRA audits don’t punish error — they penalize inconsistency. Mackisen CPA makes your numbers and documents tell the same story.

Benefits of Professional Representation

• Prevents disallowed ITCs and reassessment penalties.

• Avoids refund holds and cash-flow disruptions.

• Strengthens audit credibility with organized CPA documentation.

• Reduces exposure to GST/HST interest and penalties under ETA s.280.

• Provides legal and accounting protection for complex multi-province transactions.

Learning insight: Compliance doesn’t end with filing — it starts with preparation. Mackisen CPA ensures your compliance is continuous, not reactive.

SEO Optimization and Educational Value

Primary Keywords: CRA GST/HST Audit, GST/HST Compliance Canada, Mackisen CPA Montreal, CPA Firm Near You, Input Tax Credit Review, Place-of-Supply Rules.
Secondary Keywords: CRA GST audit defense, HST documentation Canada, GST refund audit, Mackisen CRA audit support, GST/HST interprovincial compliance.

Learning insight: CRA audits data; CPAs audit systems. Mackisen CPA ensures your system always matches CRA’s expectations.

Real Client Success

• A Montréal importer recovered $120,000 in ITCs after Mackisen CPA provided missing supplier registration evidence.

• A construction firm avoided $48,000 in penalties when our team proved compliance with zero-rated subcontractor transactions.

• A professional service provider had its GST/HST refund released within 10 days after we submitted a fully reconciled CPA binder.

Learning insight: CRA may delay refunds — Mackisen CPA accelerates them with evidence.

Why Mackisen CPA Montreal

Mackisen CPA Montreal combines over 35 years of GST/HST and QST audit experience. Our bilingual CPAs specialize in reconciling complex multi-jurisdictional filings and negotiating directly with CRA’s Indirect Tax Division. We transform fragmented data into coherent documentation that meets every CRA standard — ensuring your compliance and protecting your credibility.

Learning insight: In tax law, the strongest defense is consistency. Mackisen CPA turns every GST/HST record into proof of compliance.