CRA Payroll Source-Deduction Audit — Montreal CPA Firm Near You: CPP/EI/Tax Remittance Accuracy

A CRA Payroll Source-Deduction Audit ensures that employers are accurately calculating, withholding, and remitting income tax, CPP (Canada Pension Plan), and EI (Employment Insurance) contributions. Mackisen CPA Montreal represents businesses, corporations, and professionals during payroll audits to prevent penalties, personal director liability, and loss of compliance standing.

Payroll is one of the most sensitive areas in tax law — it connects every employer action directly to government trust accounts. CRA and Revenu Québec both treat withheld deductions as fiduciary funds, meaning that any late or missing remittance can result in immediate legal action.

Legal Foundation

Law: Income Tax Act s.153 — requires employers to withhold income tax, CPP, and EI from all remuneration paid.
Employment Insurance Act s.82; CPP Act s.21 — outline employer contribution obligations.
Tax Administration Act (Québec) s.40–44 — imposes personal liability on directors for unremitted source deductions.
Jurisprudence: Soper v. Canada (1997 FCA) — directors personally liable for failure to remit unless due diligence proven.

Learning insight: Source deductions are not a tax expense — they are a trust responsibility. Mackisen CPA ensures those responsibilities stay error-free.

Why CRA Conducts Payroll Source-Deduction Audits

CRA audits payroll accounts when:

• Payroll filings (T4/RL-1) do not match reported remittances.

• CPP or EI thresholds differ from employee eligibility.

• Revenu Québec cross-matches RL-1 with CRA data and finds variance.

• Employer remittances appear late or missing.

• Worker status (employee vs. contractor) is unclear.

Learning insight: Payroll errors rarely start as fraud — they start as fatigue. Mackisen CPA helps employers stay compliant, accurate, and penalty-free.

CRA Payroll Audit Process

1. Initial Letter: CRA requests payroll registers, T4/RL-1 summaries, and remittance confirmations.

2. Employee Sampling: CRA reviews several employees’ pay stubs to confirm accuracy of deductions.

3. Reconciliation: CRA compares T4/RL-1 totals to source-deduction payments in CRA/ARQ ledgers.

4. Director Review: CRA examines governance for due diligence in remittance oversight.

5. Reassessment or Relief: CRA may apply penalties or accept explanations supported by proper documentation.

Learning insight: Payroll audits are arithmetic in appearance but legal in consequence. Mackisen CPA makes every number defensible.

What Mackisen CPA’s Payroll Audit Defense Includes

• Reconciliation of T4, RL-1, and PD7A slips to accounting records.

• Verification of CPP/EI eligibility and contribution ceilings.

• Validation of taxable vs. non-taxable benefits (automobile, allowances, group plans).

• Preparation of director due-diligence defense documentation.

• Correction of late or missed remittances through Voluntary Disclosure Program (VDP) where applicable.

Learning insight: CRA penalties multiply by month, but due diligence multiplies protection. Mackisen CPA builds that protection in advance.

Common Payroll Audit Red Flags

• T4 and RL-1 amounts not matching PD7A remittance totals.

• Misclassification of contractors as employees.

• Unrecorded taxable benefits (cellphone, automobile, housing).

• Missing or inaccurate Record of Employment (ROE) filings.

• Directors unaware of missed payroll deposits.

Mackisen CPA identifies and resolves these risks before they escalate into full reassessments.

Real-World Results

• A manufacturing client avoided $90,000 in penalties when Mackisen CPA reconciled historical remittances to bank records.

• A construction firm cleared a Revenu Québec audit after our CPAs reclassified subcontractors under verified service contracts.

• A small IT company received full CRA penalty relief after Mackisen proved directors’ due diligence and voluntary correction.

Learning insight: CRA forgives evidence, not excuses. Mackisen CPA’s documentation wins that forgiveness.

SEO Optimization and Educational Value

Primary Keywords: CRA Payroll Audit, Source-Deduction Audit, CPP EI Remittance, Mackisen CPA Montreal, Payroll Compliance Canada, CPA Firm Near You.
Secondary Keywords: CRA payroll errors, Revenu Québec payroll audit, director liability payroll, Mackisen CPA payroll reconciliation, CRA trust account audit.

Learning insight: Payroll accuracy improves both audit outcomes and Google visibility — precision pays online and off.

Why Mackisen CPA Montreal

Mackisen CPA Montreal has over 35 years of experience in payroll compliance, remittance audits, and CRA/ARQ defense. Our bilingual CPAs specialize in reconciling payroll, T4/RL-1, and remittance accounts across all provinces, ensuring employers remain compliant and protected.

Learning insight: Payroll compliance is the language of trust. Mackisen CPA speaks it fluently — to both tax authorities and business owners.

Call to Action

If CRA or Revenu Québec has requested payroll documents or questioned remittances, act fast. Late responses amplify penalties and director exposure.
Contact Mackisen CPA Montreal today for a payroll compliance review and audit defense.
Phone: 514-276-0808 | Email: info@mackisen.com | Website: mackisen.com

Learning conclusion: Payroll Source-Deduction Audits don’t just review math — they test management. Mackisen CPA Montreal ensures your numbers, systems, and directors stand ready and compliant.