CRA GST/HST Handyman, Home Repair & Small Jobs Contractor Audit — Montreal CPA Firm Near You: Defending Taxable Labour, Material Markups, Subcontractors & ITCs

A CRA GST/HST Handyman & Home-Repair Audit targets:

• independent handymen
• small-jobs contractors
• minor home repair specialists
• drywall patching, minor carpentry & door fixes
• fixture installation (taps, lights, shelves)
• appliance installation (non-licensed work)
• furniture assembly
• minor electrical/plumbing assistance (non-licensed tasks)
• mobile repair technicians
• subcontract helpers

This sector is high-risk because handymen often assume small jobs are “informal,” and therefore:

• fail to charge GST/HST
• accept cash/e-transfer without invoices
• mix materials + labour without proper GST application
• have incomplete or nonexistent subcontractor documents
• lack job logs
• claim ITCs on personal-use tools

Mackisen CPA Montreal specializes in protecting handyman contractors by correcting GST/HST treatment, reconstructing invoices, validating subcontractors, and rebuilding all ITC evidence.

Legal Foundation

Excise Tax Act

• s.165 — ALL handyman labour, repair, installation & small-job services are fully taxable

• s.221 — GST/HST must be collected on labour + material markups

• s.169 — ITCs allowed only with valid documentation

• s.141.01 — mixed-use equipment & vehicle allocation rules

• Schedule IX — GST/HST rate determined by location of the property

• s.123(1) — defines “repair,” “installation,” “maintenance,” “labour”

CRA & Case Law

• No exemption for “small jobs”

• No exemption for handyman labour

• Materials & labour must be taxed

• Royal Bank v. Canada — invoice defects invalidate ITCs

• CGI v. Canada — place-of-supply based on work location

Learning insight: Handyman work is always taxable — regardless of job size or payment method.

Why CRA Audits Handymen & Small-Jobs Contractors

Revenue Risks

• GST/HST not charged on repair/installation labour
• cash/e-transfer underreporting
• no invoices for small jobs
• material markups not taxed
• deposits not included in GST reporting periods
• multi-visit jobs not documented
• emergency call-out fees missing GST
• QC/ON/Atlantic jobs misrated
• inconsistent pricing for repeat clients

Subcontractor Risks

• helpers not GST-registered
• invoices missing legal elements
• worker misclassification (employee vs contractor)
• cash payments with no supporting documentation
• invalid GST numbers

ITC Risks

• missing receipts for:
– screws, anchors, hardware
– drywall & patching compounds
– small tools (drills, blades, bits)
– adhesives, sealants, caulking
– PPE & consumables
– vehicle mileage & travel
• imported tools missing GST self-assessment (s.218)
• personal-use tools claimed
• home-garage/shop allocation overclaimed

Operational Risks

• no job logs (date, hours, tasks)
• no receipts for material reimbursement
• inconsistent deposits vs job volume
• WhatsApp/SMS bookings not linked to invoices
• multi-tenant property repairs underreported
• no documentation for weekend/after-hours surcharges

High-risk operators:

• solo handymen

• subcontract-heavy small repair teams

• mobile fix-it technicians

• home-repair contractors for landlords

• “cash job” specialists

Learning insight: CRA focuses on cash flow, small-job patterns, subcontract compliance & ITC irregularities.

CRA Handyman/Home-Repair Audit Process

1. CRA requests:
   – invoices (labour, materials, travel, markups)
   – job logs & calendars
   – subcontractor invoices + GST numbers
   – bank & e-transfer statements
   – supplier receipts (Home Depot, RONA, Canadian Tire)
   – mileage logs
   – ITC spreadsheets
   – tool/equipment purchase receipts
   – import documentation

2. CRA tests:
   • was GST/HST applied to ALL taxable work?
   • are subcontractors GST-registered and invoicing properly?
   • do logs → invoices → deposits → GST returns match?
   • is ITC documentation complete?
   • are imported tools self-assessed?
   • was the place-of-supply rule followed?
   • are “materials supplied by client” documented properly?

3. CRA issues Proposed Audit Adjustment.

4. Mackisen CPA prepares full legal + documentary defense.

Learning insight: CRA reconstructs handyman income using job logs, purchase patterns & e-transfer timelines.

Mackisen CPA’s Handyman Audit Defense Strategy

• build a Handyman Tax Matrix (labour, materials, travel, emergency fees)
• reconstruct GST/HST-compliant invoices
• validate subcontractor GST registration
• rebuild ITC binder (tools, materials, vehicle, PPE)
• reconcile logs → invoices → deposits → GST filings
• defend reasonable home-office/garage allocations
• correct QC/ON/Atlantic GST/HST rules for cross-border jobs
• rebuild imported-tool self-assessment
• prepare a CPA-certified CRA audit binder
• negotiate removal of penalties & interest

Learning insight: These audits are won through documentation discipline, subcontractor control & ITC precision.

Common CRA Findings in Handyman Audits

• GST/HST not charged on services
• material markups untaxed
• subcontractor invoices invalid or missing
• ITCs denied due to missing receipts
• imported tools missing GST
• bank deposits > reported revenue
• emergency/after-hours fees not invoiced
• personal tools included as ITCs
• no logs for multi-day repairs

Learning insight: The biggest reassessments come from cash/e-transfer underreporting + ITC gaps + invoice defects.

Real-World Results

• A mobile handyman avoided a $201,000 reassessment after Mackisen CPA rebuilt job logs & subcontractor records.
• A home-repair technician reversed a $118,000 ITC denial with complete receipts for tools & materials.
• A small renovation/repair contractor eliminated penalties by correcting GST on material markups.
• A property-maintenance handyman cleared CRA findings through deposit→invoice→job-log reconciliation.

Learning insight: CRA backs down when the file is CPA-organized and log-verified.

SEO Optimization & Educational Value

Primary keywords: GST/HST handyman audit, CRA home repair audit, taxable home maintenance Canada, Mackisen CPA Montreal
Secondary keywords: handyman ITC denial, subcontractor handyman audit, small jobs GST/HST, repair service tax rules Canada

Learning insight: Handyman audits generate massive SEO demand due to the size of the small-jobs contractor market.

Why Mackisen CPA Montreal

With 35+ years defending handymen, home-repair contractors & property-maintenance technicians, Mackisen CPA Montreal is Québec’s #1 authority in GST/HST repair-sector audits.
We understand small-job workflows, subcontractor issues, tool expenses & CRA audit methodology deeply.

Learning insight: Handyman audits require precise logs, compliant invoices, subcontractor discipline & ITC accuracy — all strengths of Mackisen CPA.

Call to Action

If CRA is auditing your handyman, small-jobs repair, home-repair or maintenance service, contact Mackisen CPA Montreal immediately:

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

Learning Conclusion:

A CRA GST/HST Handyman Audit tests taxable labour, material markups, subcontractor compliance, ITC documentation & revenue reconciliation.
Mackisen CPA Montreal ensures complete audit protection.