CRA Small Business Audit Defense 2025 — Protect Your Company, Prevent Penalties, and Stop CRA Reassessments with Mackisen

CRA’s Small Business Audit Division has significantly expanded its reach, targeting entrepreneurs and corporations with automated audit systems that flag even minor reporting inconsistencies. Thousands of business owners across Canada are being audited for errors they didn’t commit — from expense misclassifications and payroll discrepancies to missing GST/HST filings. These audits often result in unfair reassessments, interest, and penalties that can cripple your operations. At Mackisen CPA Auditors Montreal, we defend small businesses against CRA’s aggressive audit practices. Our CPA auditors and tax lawyers combine financial precision and legal strategy to challenge CRA findings, restore compliance, and eliminate penalties. We don’t let CRA intimidate honest entrepreneurs — we protect your hard work and your business legacy.

Legal and Regulatory Framework

Income Tax Act (Canada) Section 152(1): Gives CRA authority to assess or reassess income but requires factual evidence. Section 18(1)(a): Defines allowable business deductions for legitimate income-generating expenses. Section 230(1): Requires taxpayers to maintain detailed records to support filings. Section 67: Mandates that all business expenses must be reasonable and necessary for operations. Section 220(3.1): Enables CRA to reduce or remove penalties and interest under the Taxpayer Relief Program.
Tax Administration Act (Quebec) Revenu Québec applies parallel audit powers for QST, payroll, and corporate income tax compliance. Mackisen manages both federal and provincial reviews to ensure fairness, accuracy, and full protection.

Key Court Decisions

Bédard v. The Queen (2022): CRA must justify reassessments with verified financial records, not assumptions. Thibault v. The Queen (2022): Valid documentation and good faith protect businesses from penalties. Guindon v. Canada (2015): Honest reporting errors are not grounds for gross negligence. Jordan v. The Queen (2009): CRA must act with fairness and transparency in small business audits. These rulings confirm that small businesses have legal protection against arbitrary CRA action.

Why CRA Targets Small Businesses

CRA’s 2025 audit model uses data analytics to identify patterns of “risk.” Common triggers include excessive expense claims, inconsistent profit margins, cash-based transactions, frequent losses, or missing source deductions. CRA assumes risk — Mackisen proves compliance.

Mackisen’s Small Business Audit Defense Strategy

1. Risk Review: Analyze CRA’s audit letter and identify the triggers behind the audit. 2. Documentation Reconstruction: Rebuild accounting files, receipts, and reports to strengthen your position. 3. Legal and Financial Response: Present detailed, evidence-based submissions that refute CRA’s claims. 4. Negotiation and Appeals: Communicate directly with CRA auditors or Appeals Officers to reduce or eliminate reassessments. 5. Penalty and Interest Relief: File under Section 220(3.1) to cancel financial penalties and restore fairness. Mackisen’s process ensures your business is defended from both audit risk and financial damage.

Real Client Experience

A Montreal restaurant was audited for “unverified supplier expenses.” Mackisen reconstructed documentation and CRA cancelled the entire $126,000 reassessment. A Quebec contractor faced $88,000 in payroll penalties. Mackisen provided compliance records and CRA withdrew every charge.

Common Questions

Can CRA audit my business every year? Yes, but Mackisen prevents repeat audits by improving compliance systems. What happens if I lose receipts? Mackisen rebuilds alternative proof through bank statements and digital invoices. Can CRA cancel penalties after audit? Absolutely — Mackisen secures full relief under the Taxpayer Relief Program. Can CRA seize business funds during audit? Only in extreme cases — Mackisen stops enforcement through legal objection.

Why Mackisen

At Mackisen CPA Auditors Montreal, we are Canada’s leading defenders of small business owners against CRA audits and reassessments. Our integrated team of CPAs and tax lawyers provides strategic protection, financial clarity, and peace of mind. We act fast, defend aggressively, and negotiate smartly — because small businesses deserve big protection. When CRA audits your company, Mackisen audits their fairness. Call Mackisen CPA Auditors Montreal today for your 2025 Small Business Audit Defense Consultation. The first meeting is free, and your protection starts immediately.