CRA Large-Case GST/HST Audit — Montreal CPA Firm Near You: Complex Transactions

A CRA Large-Case GST/HST Audit targets corporations with annual sales, imports, or transactions that exceed standard audit thresholds. These audits focus on complex inter-company, cross-border, and high-value transactions to verify compliance with the Excise Tax Act. They are not routine — they are strategic. CRA’s Large Business Audit Division assigns senior auditors and forensic teams to test every GST/HST cycle: collection, remittance, and refund. Mackisen CPA Montreal provides professional audit defense, documentation management, and expert negotiation to protect your company’s reputation, working capital, and compliance record.

Legal Foundation

Law: Excise Tax Act (ETA) s. 286–289 (record-keeping and documentation requirements), s. 123(1) (definition of taxable supply), s. 169 (input-tax-credit conditions), and s. 221 (collection obligations).
Jurisprudence: Northwest Company Inc. v. Canada (2011 TCC) — CRA may deny ITCs if invoices, payments, or supplier registration proof are missing or inconsistent.

Why CRA Targets Large-Case GST/HST Files

CRA’s Large-Case Audit Program focuses on corporations with complex structures, related-party transactions, inter-provincial operations, or multi-jurisdictional billing. Common triggers include:

• Annual revenues above $250 million or significant GST refunds.

• Multi-entity structures with inter-company management fees.

• Frequent cross-border services or imports.

• Large input-tax-credit (ITC) claims with complex allocations.

• Mismatched place-of-supply rules between provinces.

Learning insight: The CRA doesn’t just audit numbers — it audits systems. The larger your structure, the more your systems must prove compliance.

The Mackisen CPA Large-Case Audit Defense Strategy

1. Pre-Audit Assessment: We review CRA’s audit plan, scope, and initial questionnaires to anticipate risk areas.

2. Transaction Mapping: Our CPAs build a detailed flowchart of GST/HST through your supply chain, ensuring every link is supported.

3. Document Validation: We verify that every invoice and ITC claim meets the requirements under ETA s.169 and CRA Policy P-222.

4. Cross-Entity Reconciliation: We align GST collected, remitted, and claimed across all subsidiaries and divisions.

5. CRA Liaison and Negotiation: Mackisen CPA handles all communications, submissions, and reconciliations directly with CRA’s Large Business Division.

6. Post-Audit Strategy: We identify potential refunds, credits, or appeal opportunities after completion.

Learning insight: A large-case audit isn’t just about defense — it’s an opportunity to strengthen your corporate compliance and recover hidden credits.

Common Issues Found in Large-Case GST/HST Audits

• Inter-company invoices missing GST/HST registration numbers.

• Incorrect place-of-supply applications between Québec, Ontario, and other provinces.

• Overclaimed ITCs on partially exempt financial or real-estate operations.

• GST/HST not self-assessed on imported services or cross-border licensing.

• Ineligible ITCs on employee expenses, vehicles, or entertainment.

Each of these findings can result in penalties, interest, and multi-year reassessments — unless corrected early.

Learning insight: CRA assumes complexity equals opportunity for error. Mackisen CPA’s precision reverses that logic by turning complexity into documentation strength.

Financial Exposure in Large-Case Audits

• Denied ITCs on inter-company invoices: $50,000–$500,000 per year.

• Place-of-supply misclassification penalties: 6–15 % of total transaction volume.

• Late remittance interest compounded daily under ETA s.280.

• Potential criminal referral for systemic non-remittance in high-risk cases.

Learning insight: In a large-case audit, even a 1 % error margin can equal a six-figure liability. Mackisen CPA reduces that margin to zero through proactive reconciliation.

Real-World Example

A Montréal-based importer/exporter with $300 million in annual turnover faced a CRA hold on $1.2 million of ITCs. CRA claimed that supplier invoices lacked valid registration numbers and that internal allocations between divisions distorted commercial activity percentages. Mackisen CPA reconstructed all invoices, obtained registration proofs from 36 suppliers, and delivered a unified audit binder. CRA accepted 97 % of the ITCs and released the refund in 21 days.

Learning insight: In a complex audit, success depends on organization, not argument.

SEO Optimization and Educational Value

Primary Keywords: CRA Large-Case GST/HST Audit, Mackisen CPA Montreal, CPA Firm Near You, CRA Large Business Audit, Input Tax Credit Verification, GST/HST Cross-Border Compliance.
Secondary Keywords: CRA GST large corporation audit, inter-company GST compliance, GST/HST documentation Canada, Mackisen CPA large business defense, CRA place-of-supply rules Québec.

Learning insight: Large-case audits reward documentation excellence. When every transaction can be traced and proven, CRA’s case dissolves before it starts.

How Mackisen CPA Builds a Strong Defense

• Implements a GST/HST Documentation Protocol aligned with CRA Memoranda 28-1 to 28-3.

• Creates cross-ledger reconciliations between sales, purchases, and ITC accounts.

• Conducts mock audits to test compliance before CRA’s arrival.

• Provides real-time communication with CRA auditors to prevent file escalation.

• Coordinates voluntary corrections through amended returns, protecting interest and penalties.

Learning insight: A proactive defense is the only real defense. CRA auditors respect organized, transparent, CPA-reviewed files — not silence.

Real Client Success

• A technology firm with subsidiaries in Québec and Ontario avoided a $340,000 penalty by proving proper place-of-supply classification.

• A manufacturing group reduced its GST exposure from $290,000 to $11,500 after Mackisen CPA identified unclaimed ITCs.

• A real-estate developer cleared a 3-year audit backlog by presenting CRA with a single reconciled audit binder.

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Why Mackisen CPA Montreal

Mackisen CPA Montreal represents large corporations, developers, and import/export businesses during high-stakes GST/HST and QST audits. With over 35 years of combined experience, our firm translates complex transactions into clear, legally defensible documentation. We coordinate directly with CRA’s Large Business Audit Division and Revenu Québec’s Corporate Audit Branch to achieve faster, fairer outcomes.

Learning insight: CRA’s Large-Case Division doesn’t intimidate Mackisen CPA — it motivates us to raise the bar of precision.