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

A CRA Payroll Source-Deduction Audit focuses on verifying that an employer has accurately calculated, deducted, and remitted all statutory source deductions, including Canada Pension Plan (CPP) contributions, Employment Insurance (EI) premiums, and federal/provincial income taxes. Revenu Québec performs a parallel verification for QPP, QPIP, and Health Services Fund (HSF) contributions. Mackisen CPA Montreal provides professional payroll audit defense to ensure every employee record, remittance, and reconciliation stands up to government inspection.

Legal Foundation

Law: Income Tax Act s.153; Tax Administration Act (Québec) ss.40–44; Employment Insurance Act s.82; Canada Pension Plan s.21.
Jurisprudence: Bélanger v. The Queen (2001 TCC) — confirmed that employers bear full liability for failure to withhold or remit statutory deductions even if payroll processing is outsourced.

Why You Need a CPA for a Payroll Source-Deduction Audit

CRA and ARQ payroll audits can extend several years back and impose severe penalties for non-compliance—up to 20% for late or missing remittances, plus interest. A CPA ensures every employee, contractor, and remittance record reconciles to the general ledger, payroll summaries, and T4/RL-1 filings.

Mackisen CPA Montreal conducts proactive reconciliations that protect you from penalties, misclassification findings, and director liability exposure.

Learning insight: Payroll compliance is not bookkeeping—it’s a fiduciary duty. CRA treats withheld taxes as government trust funds.

What Mackisen CPA’s Payroll Audit Defense Includes

• Full reconciliation of T4, RL-1, and payroll ledger records.

• Verification of employer and employee CPP/EI/QPP/QPIP/HSF contributions.

• Review of payroll frequency, due dates, and late-remittance penalties.

• Validation of taxable benefits, allowances, and reimbursements.

• Documentation of employee vs. contractor classification consistency.

Learning insight: Payroll errors are not mistakes—they’re compliance risks. A CPA turns payroll from liability to audit-proof accuracy.

Common Triggers for CRA Payroll Source-Deduction Audits

• Late or irregular payroll remittances.

• Discrepancies between T4 and corporate tax expense accounts.

• Repeated “nil” or missing monthly remittances.

• Worker classification disputes or unregistered contractors.

• CRA matching variances between PD7A, GST/HST filings, and T2 returns.

Mackisen CPA Montreal identifies and corrects these red flags early, ensuring complete payroll reconciliation before an auditor requests records.

How Mackisen CPA Manages Payroll Audits

1. Conducts a pre-audit compliance scan across all payroll systems.

2. Reconciles PD7A statements to CRA/ARQ balances and general ledger.

3. Validates all source deductions against employer returns.

4. Prepares detailed CPA-certified reconciliation packages for audit submission.

5. Represents employers directly in CRA and ARQ communications to minimize disruption.

Learning insight: CRA doesn’t audit forms—it audits flow. Mackisen CPA ensures every dollar deducted flows from payroll to payment proof.

Benefits of Professional Representation

• Avoids duplicate assessments and ensures penalty relief requests are filed.

• Corrects remittance errors proactively before CRA assessment.

• Protects corporate officers under ITA s.227.1 and ETA s.323.

• Improves payroll governance, accuracy, and control systems.

• Establishes long-term audit-readiness for all remittance accounts.

Learning insight: Payroll is where tax, employment, and trust law intersect. A CPA ensures your compliance at all three levels.

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Learning insight: CRA payroll audits test control, not convenience. Mackisen CPA ensures your payroll passes both accounting and legal standards.

Real Client Success

• A manufacturing firm avoided $65,000 in penalties after Mackisen CPA reconciled a misclassified subcontractor as an employee.

• A construction company cleared a multi-year CPP/EI remittance audit by proving third-party payroll-service accuracy.

• A retail chain prevented a director-liability assessment when we documented timely payments despite CRA posting errors.

Why Mackisen CPA Montreal

Mackisen CPA Montreal unites accounting accuracy, tax-law compliance, and legal defense into a single payroll-audit solution. Our bilingual team works directly with CRA and Revenu Québec to clear payroll audits quickly and professionally.

Learning insight: Payroll compliance isn’t about forms—it’s about foresight. Mackisen CPA ensures every payroll decision today prevents tomorrow’s penalties.

Learning conclusion: Payroll audits expose weaknesses—but with Mackisen CPA Montreal, they build resilience. Every deduction verified, every remittance proven—your compliance, secured.