CRA GST/HST E-Commerce & Online Business Audit — Montreal CPA Firm Near You: Defending Shopify, Amazon, Etsy, Dropshipping & Digital Sales

A CRA GST/HST E-Commerce Audit examines whether your online business — Shopify store, Amazon seller, Etsy shop, dropshipping operation, subscription platform, coaching funnel, or digital product site — correctly charged, collected, remitted, and claimed GST/HST.

E-commerce is one of the fastest-growing and most aggressively audited sectors because online businesses often:
• sell across multiple provinces → wrong GST/HST rates
• sell to foreign customers → zero-rating must be proven
• use dropshipping → tax responsibility unclear
• receive payouts from platforms that don’t match reported sales
• claim ITCs on ads, software, & imported digital services
• under-document transactions
• use multiple payment processors (Stripe, PayPal, Shopify, Amazon, Klarna)
• handle refunds, chargebacks, and shipping adjustments

Mackisen CPA Montreal specializes in defending e-commerce audits by reconciling platform reports, reconstructing tax logic, validating ITCs, and preparing CPA-certified audit binders that dismantle CRA assumptions.

Legal Foundation

Excise Tax Act

• s.165 — GST/HST applies to taxable digital & physical goods

• s.169 — ITC eligibility rules

• s.221 — collection & remittance obligations

• s.218/218.1 — self-assessment required on imported software/digital services

• Schedule IX — place-of-supply rules for interprovincial sales

• Schedule VI — zero-rating rules for sales to foreign customers

Case Law

• Honeywell v. Canada — zero-rating requires objective proof

• City of Calgary v. Canada — consumer location determines GST/HST rate

• United Servco — shipping charges follow supply tax status

• Royal Bank v. Canada — ITCs need perfect documentation

Learning insight: E-commerce taxation depends on customer location, not business location.

Why CRA Audits E-Commerce & Online Sellers

CRA audits e-commerce when it detects:
• mismatched Shopify/Amazon payouts vs GST filings
• incorrect GST/HST rates across provinces
• foreign sales zero-rated without proof of export or foreign consumption
• missing self-assessment on imported software (Facebook Ads, Google Ads, Amazon Ads, Klaviyo, HubSpot, Canva)
• dropshipping orders unclear (supplier vs merchant obligations)
• subscription revenue underreported
• digital products (courses, templates) not taxed correctly
• multi-currency issues (USD payouts inconsistently recorded)
• multiple merchant accounts with inconsistent reporting
• large ITCs for advertising, software, SaaS, and fulfillment expenses

High-risk businesses include:

• Shopify stores

• Amazon FBA sellers

• Etsy creators

• dropshipping operations

• subscription box companies

• online course creators

• coaching & info-product funnels

• digital product marketplaces

• SaaS + e-commerce hybrids

• POD (print-on-demand) merchants

Learning insight: CRA assumes misreported revenue + ITCs unless every system matches perfectly.

CRA E-Commerce Audit Process

1. CRA requests:
   – Shopify / Amazon / Etsy exports
   – merchant processor statements (Stripe, PayPal, Square, Klarna)
   – bank statements
   – invoices & proof of payment
   – shipping logs & fulfillment records
   – ads invoices (Facebook/Google/TikTok)
   – SaaS & software invoices
   – refund/chargeback reports
   – customer address data

2. CRA tests:
   • correct GST/HST rate per province
   • revenue vs payouts vs deposits
   • ITC documentation
   • foreign sales eligibility for zero-rating
   • shifts in tax responsibility for dropshipping
   • subscription billing & allocation
   • shipping charge tax treatment

3. CRA issues a Proposed Audit Adjustment.

4. Mackisen CPA prepares a complete factual-legal defense.

Learning insight: CRA cross-matches your merchant data, tax returns, and bank deposits — everything must reconcile.

Mackisen CPA’s E-Commerce Audit Defense Strategy

• reconcile Shopify/Amazon/Etsy reports with merchant processor deposits
• rebuild place-of-supply matrix for all provinces
• verify zero-rating for foreign customers (IP logs, billing addresses, shipping proof)
• defend dropshipping using supply-chain tax logic
• reconstruct ITC proof for ads, software, SaaS & fulfillment fees
• create digital supply classification (service, SaaS, intangible property)
• correct GST/HST treatment for subscriptions & memberships
• prepare CPA-certified audit binder tailored to CRA requirements
• negotiate penalty relief for unintentional errors

Learning insight: In e-commerce audits, the business that presents the cleanest data model wins.

Common CRA Findings in E-Commerce Audits

• wrong GST/HST rate applied (ex: charging 5% instead of 13% or 15%)
• foreign sales zero-rated without proof → GST/HST assessed
• ITCs denied due to missing invoices or foreign-supplier documentation
• dropshipping treated incorrectly (who is the supplier?)
• subscription revenue underreported
• merchant processor deposits not matching tax returns
• advertising expenses with no self-assessment on imported digital services
• digital products misclassified
• shipping charges taxed incorrectly

Learning insight: CRA sees e-commerce as “high-risk” because every system must match — and many businesses don’t reconcile.

Real-World Results

• A Shopify seller avoided a $480,000 reassessment when Mackisen CPA rebuilt GST/HST rates for all provinces and reconciled platform mismatches.
• An Amazon FBA merchant reversed a $190,000 ITC denial after we reconstructed proof of payment and supplier tax documentation.
• An online course creator eliminated penalties by proving foreign-consumption zero-rating using IP logs and email receipts.
• A dropshipping entrepreneur avoided a six-figure GST adjustment when we demonstrated proper supply-chain tax responsibility.

Learning insight: Most CRA findings collapse once your CPA provides structured, irrefutable data.

SEO Optimization & Educational Value

Primary keywords: GST/HST e-commerce audit, CRA Shopify audit, Amazon seller GST audit, Mackisen CPA Montreal
Secondary keywords: dropshipping GST rules, zero-rated foreign digital sales, GST audit online business, ITC denial ecommerce

Learning insight: E-commerce taxation is one of the highest-searched categories — strong content boosts firm authority.

Why Mackisen CPA Montreal

With 35+ years of GST/HST and digital-commerce audit defense, Mackisen CPA Montreal is Québec’s top authority on Shopify, Amazon, Etsy, dropshipping, subscriptions, and digital product GST/HST compliance.
We understand every platform — and we build data-driven audit files that CRA cannot challenge.

Learning insight: E-commerce audits are won through data integrity + tax logic + documentation precision — our specialty.

Call to Action

If CRA is auditing your Shopify store, Amazon business, dropshipping operation, or digital product platform, contact Mackisen CPA Montreal now:

📞 514-276-0808
📧 info@mackisen.com
🌐 mackisen.com

Learning Conclusion:

A CRA GST/HST E-Commerce Audit tests tax rates, foreign sales, ITCs, platform data, and cross-system reconciliation.
Mackisen CPA Montreal ensures every supply is classified correctly, every receipt is documented, and every dollar is defended — protecting your online business from costly reassessments.