CRA GST/HST New Construction Audit — Montreal CPA Firm Near You: Defending New Builds, Owner-Built Homes, and Substantial Renovations

A CRA GST/HST New Construction Audit determines whether your newly built, substantially renovated, or owner-built residential property was correctly reported for GST/HST purposes. CRA focuses on whether GST/HST should have been charged, self-assessed, or rebated, and whether you legally qualify as a consumer or a builder under the Excise Tax Act.
These audits can lead to $30,000–$200,000 reassessments if CRA believes the property wasn’t used as a primary residence or was actually built “for resale.”

Mackisen CPA Montreal specializes in defending these high-risk audits with full timeline reconstruction, builder-status defense, occupancy proof, and GST/HST liability calculations.

Legal Foundation

Excise Tax Act s.191 — GST/HST self-assessment rules for new residential properties and change of use.
Excise Tax Act s.123(1) — defines “builder,” “substantial renovation,” “residential complex.”
Excise Tax Act s.254 — New Housing Rebate eligibility.
Case law:
• Chella v. Canada — intention + evidence determine builder status.
• Tarnowe v. Canada — occupancy proof is mandatory for rebate eligibility.

Learning insight: GST/HST on new construction depends on intent, use, and evidence — not just the purchase contract.

Why CRA Audits New Construction

CRA triggers these audits when it detects:
• new builds sold shortly after completion
• owner-built homes with missing self-assessment
• substantial renovations claimed as exempt when they qualify as “new housing”
• purchase of new homes with no occupancy before resale
• rebates claimed without utility or occupancy proof
• suspected flipping activity
• Airbnb or short-term rentals instead of long-term occupancy
• inconsistent addresses on IDs, insurance, and utility bills

Learning insight: CRA assumes builder status unless you prove genuine personal use.

CRA New Construction Audit Process

1. CRA requests:
   – building permits
   – contractor invoices
   – occupancy proof (utilities, insurance, driver’s license, tax bills)
   – MLS listings, marketing, or rental ads
   – mortgage documents
   – closing documents and land registry records

2. CRA reconstructs full intention timeline.

3. CRA determines whether GST/HST should have been:
   • charged on sale
   • self-assessed on completion
   • rebated under s.254

4. CRA evaluates whether substantial renovations = new construction.

5. CRA issues proposed reassessment.

6. Mackisen CPA prepares evidence and legal analysis to reverse or reduce the assessment.

Learning insight: CRA relies on missing documentation to justify reassessments. Your CPA fills every gap.

Mackisen CPA’s New Construction Audit Defense Strategy

• prove actual occupancy using utility consumption, insurance policies, ID updates
• defend principal residence intention with structured timelines
• demonstrate non-builder status using evidence of personal use
• calculate correct GST/HST self-assessment (if applicable)
• defend substantial renovations as non-new where conditions are not met
• prepare legal-tax memos referencing Excise Tax Act definitions
• correct GST/HST filings where errors occurred
• dispute CRA assumptions with fact-based CPA documentation

Learning insight: Builder classification is the #1 risk — and the #1 defense Mackisen CPA is known for winning.

Common CRA Findings in New Construction Audits

• property deemed a builder-built home → GST/HST becomes payable
• rebate denied due to lack of occupancy
• CRA claims substantial renovation = new construction
• missing or inaccurate self-assessment
• “personal use” rejected due to quick sale
• change-of-use rules ignored (rental → personal or personal → rental)
• false assumption of flipping due to lack of timeline proof

Learning insight: CRA audit findings are usually interpretation errors, not tax errors — and can be overturned with documentation.

Real-World Results

• Client avoided a $186,000 reassessment after we proved the home was genuinely occupied as a primary residence with hydro usage and insurance records.
• A builder classification was reversed for a client who sold quickly due to family reasons — documented properly by Mackisen CPA.
• A landlord avoided a $72,000 GST bill when we showed the property was intended for long-term rental, not resale.
• A homeowner kept a $24,000 rebate after we reconstructed all substantial renovation documentation.

Learning insight: CRA withdraws when the evidence is stronger than their assumptions — we deliver that evidence.

SEO Optimization and Educational Value

Primary keywords: CRA new construction audit, GST/HST new home audit, substantial renovation audit, Mackisen CPA Montreal, GST housing rebate audit
Secondary keywords: GST builder classification, self-assessment new build, GST on new homes Canada, CRA occupancy proof audit

Learning insight: Strong content attracts both CRA and clients — clarity is your greatest asset.

Why Mackisen CPA Montreal

With over 35 years of real estate GST/HST defense, Mackisen CPA Montreal is Québec’s leading expert for new-construction audits. Our bilingual CPAs understand how CRA interprets builder status, substantial renovation definitions, rebate eligibility, and self-assessment rules, and we build audit files that are impossible to dispute.

Learning insight: New construction audits are won through timeline reconstruction and legal precision — our specialty.

Call to Action

If CRA is auditing your new construction, substantial renovation, or rebate, act immediately — early defense prevents six-figure reassessments.
Contact Mackisen CPA Montreal for complete audit defense and GST/HST real estate guidance.
Phone: 514-276-0808 | Email: info@mackisen.com | Website: mackisen.com

Learning conclusion: A CRA GST/HST New Construction Audit tests intent, occupancy, and classification. Mackisen CPA Montreal ensures your documentation is airtight and your tax position fully defended.