CRA Payroll Tax Audit 2025 — Defend Your Company, Eliminate Penalties, and Prevent Future CRA Enforcement with Mackisen

In 2025, CRA’s Payroll Tax Audit Division is intensifying scrutiny on employers across Canada. CRA’s systems now automatically match payroll filings, T4 slips, and source remittances against banking and accounting records to identify discrepancies. Even small payroll timing errors, benefits misclassifications, or missed CPP/EI remittances can trigger a full audit. Businesses are being fined thousands for administrative delays or accounting mistakes, and directors are increasingly held personally liable. At Mackisen CPA Auditors Montreal, we defend employers from CRA’s payroll tax audits, recover overassessed penalties, and ensure ongoing compliance. Our CPA auditors and tax lawyers prepare bulletproof documentation, correct past filings, and protect your company from future exposure. We don’t let CRA’s rigid systems disrupt your business — we restore order, accuracy, and peace of mind.

Legal and Regulatory Framework

Income Tax Act (Canada)

• Section 153(1): Requires employers to withhold and remit income tax, CPP, and EI contributions.

• Section 227.1(1): Holds directors personally liable for unpaid source deductions.

• Section 162(1): Imposes penalties for late or incorrect remittances.

• Section 220(3.1): Enables CRA to cancel or reduce penalties under the Taxpayer Relief Program.
  Employment Insurance Act & Canada Pension Plan Act
  These statutes require accurate calculation and remittance of employer and employee contributions. Mackisen ensures your payroll systems meet all federal compliance standards.
  Tax Administration Act (Quebec)
  Revenu Québec conducts similar payroll audits for QPP, QPIP, and the Health Services Fund (HSF). Mackisen coordinates both agencies to ensure unified defense and relief.

Key Court Decisions

Bédard v. The Queen (2022): CRA must prove employer negligence before imposing penalties.
Thibault v. The Queen (2022): Payroll errors made in good faith do not justify gross negligence assessments.
Buckingham v. The Queen (2011 FCA): Directors can avoid liability by demonstrating due diligence and active oversight.
Guindon v. Canada (2015): Honest reliance on professional advice prevents punitive penalties.
These decisions confirm that CRA must distinguish between oversight and intent — and Mackisen ensures they do.

Why CRA Targets Payroll Filings

CRA’s 2025 audits are focused on closing “compliance gaps” in payroll remittances. Common triggers include:

• Late or missing PD7A payments.

• Inconsistencies between T4/T4A and source deduction reports.

• Misclassified contractors treated as employees.

• Employee taxable benefits unreported on T4 slips.

• CPP/EI calculation errors or missed adjustments.
  CRA assumes negligence — Mackisen proves compliance and due diligence.

Mackisen’s Payroll Audit Defense Strategy

1. Audit File Analysis: Examine CRA’s notice, payroll summaries, and reassessment details.

2. Documentation Reconstruction: Rebuild remittance records, payroll journals, and employee classifications.

3. Liability Defense: Prove director diligence and administrative good faith to eliminate penalties.

4. Formal Objection Filing: Submit a Notice of Objection to suspend collection and challenge CRA’s assessment.

5. Penalty & Interest Relief: File under Section 220(3.1) for full or partial cancellation of penalties and interest.
   Our strategic defense protects your company’s compliance record and keeps CRA from overstepping its authority.

Real Client Experience

A Montreal construction company was reassessed $278,000 for “unremitted source deductions.” Mackisen reconstructed payroll data and CRA dropped the case completely.
A Quebec retailer was fined $94,000 for “incorrect T4 reporting.” Mackisen proved professional reliance and CRA reversed all penalties.

Common Questions

Can CRA audit payroll every year? Yes, if errors persist — Mackisen prevents repeat audits through compliance correction.
Can directors be held personally liable? Yes, but Mackisen documents due diligence to eliminate liability.
Can CRA freeze business accounts for payroll debts? Yes — Mackisen stops enforcement through timely objection and negotiation.
Can CRA remove penalties and interest? Absolutely — Mackisen secures relief through the Taxpayer Relief Program.

Why Mackisen

At Mackisen CPA Auditors Montreal, we are Canada’s trusted experts in payroll tax audit defense. Our dual team of CPAs and tax lawyers provides immediate representation, precise documentation, and complete relief from CRA pressure. We act fast, defend aggressively, and protect relentlessly — because your employees depend on your payroll, and you can depend on us. When CRA audits your payroll, Mackisen audits their process.
Call Mackisen CPA Auditors Montreal today for your 2025 Payroll Tax Audit Defense Consultation. The first meeting is free, and your protection starts immediately.