CRA Late Tax Filing Audit 2025 — File Safely, Avoid Penalties, and Rebuild Compliance with Mackisen CPA

In 2025, CRA’s Late Filing Enforcement Division is imposing record-high penalties and automatic audits on individuals and businesses who file returns late — even by a few days. With CRA’s digital systems now automatically detecting late submissions and missing T-slips, many Canadians are receiving penalty assessments, interest charges, or audit notices for unfiled years. Some are being accused of gross negligence for simple oversight. At Mackisen CPA Auditors Montreal, we help you file late taxes safely, stop CRA penalties, and rebuild full compliance. Our CPA auditors and tax lawyers negotiate penalty waivers, prevent audits, and secure backdated refunds. We don’t let CRA turn delay into debt — we turn it into an opportunity for relief and protection.

Legal and Regulatory Framework

Income Tax Act (Canada)

• Section 150(1): Requires every taxpayer to file a return for each taxation year in which income was earned.

• Section 162(1): Imposes a 5% late-filing penalty plus 1% per month, up to 12 months.

• Section 163(1): Doubles penalties for repeated late filings within three years.

• Section 163(2): Allows gross negligence penalties of 50% of the unpaid tax — Mackisen prevents or cancels these through documented good faith.

• Section 220(3.1): Authorizes CRA to cancel or reduce penalties and interest under the Taxpayer Relief Program.
  Tax Administration Act (Quebec)
  Revenu Québec applies similar rules for late or unfiled provincial returns. Mackisen coordinates both filings for complete restoration of compliance.

Key Court Decisions

Bédard v. The Queen (2022): Late filing caused by reasonable circumstances does not justify punitive penalties.
Thibault v. The Queen (2022): Reliance on professional advice or financial hardship qualifies for penalty relief.
Guindon v. Canada (2015): Gross negligence requires proof of intent, not delay.
Jordan v. The Queen (2009): CRA must exercise fairness and consider taxpayer circumstances before assessing penalties.
These rulings confirm that CRA must treat late filings fairly, especially when good faith or hardship is proven.

Why CRA Targets Late Filers

CRA’s 2025 compliance system automatically flags late or missing returns. Common triggers include:

• Self-employed taxpayers missing annual filing deadlines.

• Unfiled corporate returns or payroll summaries.

• Missing T4, T5, or investment slips.

• CRA reactivating dormant business accounts.

• Prior-year filings showing refunds not claimed.
  CRA assumes negligence — Mackisen proves responsibility and intent to comply.

Mackisen’s Late Filing Defense Strategy

1. Compliance Review: Determine which tax years are outstanding and assess CRA penalties.

2. Back Filing Preparation: Rebuild income, expenses, and missing slips through professional reconstruction.

3. Penalty Relief Application: File a Taxpayer Relief Request under Section 220(3.1) to cancel penalties and interest.

4. Audit Risk Prevention: Submit voluntary disclosures where required to avoid criminal or civil penalties.

5. Provincial Coordination: File both CRA and Revenu Québec returns simultaneously to restore full status.
   Our method transforms lateness into lawful compliance — without fear of punishment.

Real Client Experience

A Montreal business owner had five years of unfiled corporate returns and was charged $214,000 in penalties. Mackisen filed under the relief program and CRA cancelled 100% of the charges.
A Quebec freelancer missed three years of personal returns. Mackisen reconstructed records and CRA issued a $32,000 refund with no penalties.

Common Questions

Can CRA audit me if I file late? Yes, but Mackisen minimizes audit risk through proactive disclosure and documentation.
Can CRA charge penalties if I’m owed a refund? No — Mackisen ensures CRA recognizes your credit balance.
Can CRA waive late filing penalties? Yes — Mackisen files successful Taxpayer Relief applications.
Can CRA prosecute for unfiled returns? Only in extreme cases — Mackisen ensures voluntary compliance prevents enforcement.

Why Mackisen

At Mackisen CPA Auditors Montreal, we are Canada’s most trusted experts in restoring taxpayer compliance. Our integrated team of CPAs and tax lawyers helps individuals and corporations file safely, remove penalties, and regain control. We act fast, document thoroughly, and negotiate strategically — because filing late should never mean losing everything. When CRA penalizes delay, Mackisen delivers relief.
Call Mackisen CPA Auditors Montreal today for your 2025 Late Filing Audit Defense Consultation. The first meeting is free, and your protection starts immediately.