How To Prepare For A CRA Audit 2025

Few words cause more stress than “CRA Audit.” In 2025, audits are faster, smarter, and far more detailed than ever before. CRA’s artificial intelligence now cross-analyzes income, business expenses, property records, and even digital transactions. A simple letter or email from the CRA can mean your file has been selected for review—and how you respond determines whether it ends quickly or turns into months of financial scrutiny.

Most taxpayers panic, make rushed statements, or hand over incomplete information. That’s exactly what CRA expects—and penalizes. The good news? With proper preparation, you can navigate an audit confidently, avoid penalties, and even close the audit without paying a dollar more.

At Mackisen CPA Auditors Montreal, we help clients prepare, organize, and defend their filings before, during, and after CRA audits. Our audit specialists understand CRA procedures inside out—we know what they look for, what documentation they demand, and how to respond with precision and authority. With us by your side, you’re not just compliant—you’re protected.

Legal and Regulatory Framework

Income Tax Act (Canada)
Section 231.1: Grants CRA authority to inspect books, records, and supporting documents.
Section 231.2: Allows CRA to request third-party information (banks, clients, payroll).
Section 163(2): Imposes penalties for gross negligence or false statements.
Section 152(4): Extends reassessment periods where misrepresentation or omission occurs.

Tax Administration Act (Quebec)
Allows Revenu Québec to perform parallel audits on income, GST/QST, and payroll with equivalent enforcement power.

Mackisen ensures all filings, receipts, and records are audit-ready. We manage correspondence with CRA and Revenu Québec on your behalf, preventing miscommunication and minimizing risk.

Key Court Decisions

Guindon v. Canada (2015): CRA penalties are enforceable even when errors stem from oversight.
Jordan v. The Queen (2009): Interest accrues automatically until reassessed balances are settled.
Loyola Construction Ltd. v. Canada (1992): Incomplete documentation gives CRA the right to estimate income and reassess taxes.

These rulings emphasize one fact: documentation is your strongest defense—and professional representation your greatest protection.

Why Audit Preparation Matters

When CRA audits your file, they’re not just checking for errors—they’re looking for patterns, inconsistencies, or missing records that suggest misreporting. The moment you receive an audit letter, your file moves into a structured process that can expand into multiple years or tax accounts if not handled correctly.

Common Reasons for 2025 CRA Audits:

• Unreported or mismatched income between T4/T5 slips and returns

• High or unusual deductions (vehicle, home office, meals, travel)

• Repeated business or rental losses

• Cash-based business activities

• GST/HST or payroll discrepancies

• Foreign income reporting gaps or missing T1135 forms

Preparation ensures that your information is clear, consistent, and backed by evidence—reducing the likelihood of reassessment.

Mackisen’s CRA Audit Preparation & Protection Strategy

1. Audit Risk Assessment: Evaluate your CRA file to identify exposure points before the audit begins.

2. Document Organization: Gather all receipts, contracts, and statements that substantiate your income and deductions.

3. Compliance Alignment: Ensure your CRA, Revenu Québec, GST/HST, and payroll data are synchronized.

4. Audit Representation: Communicate directly with CRA auditors on your behalf—so you never face them alone.

5. Post-Audit Review: Address CRA findings, file adjustments if necessary, or initiate a formal objection within 90 days.

Our process transforms stress into structure—protecting your finances and your credibility throughout the audit.

Real Client Experience

A Montreal consultant received a CRA audit letter requesting three years of records for vehicle and home office expenses. Mackisen reconstructed the documentation, represented her at every stage, and closed the audit with no balance owing.
A construction firm faced a GST/QST payroll audit after an employee classification error. Mackisen managed the full audit, corrected filings, and reduced the potential reassessment from $86,000 to $4,200.

Common Questions

What should I do when I receive an audit letter? Contact Mackisen immediately. Do not respond directly without professional review.
How long does a CRA audit last? It can range from a few weeks to several months depending on scope and complexity.
Can CRA audit more than one year? Yes, usually up to three years, but up to ten if misrepresentation is suspected.
What happens after an audit? CRA will issue a proposal letter or reassessment. Mackisen reviews it and files objections where necessary.

Why Mackisen

At Mackisen CPA Auditors Montreal, we don’t just respond to audits—we prevent them from escalating. Our team of CPA auditors and tax lawyers provides the defense, documentation, and expertise you need to stand strong against CRA scrutiny. We turn complex tax issues into clear, manageable resolutions.

We believe in protecting your integrity as much as your income. With Mackisen by your side, you’ll face the CRA with confidence—not fear.

Call Mackisen CPA Auditors Montreal today for your 2025 CRA Audit Preparation & Defense Review. The first consultation is free, and your protection begins immediately.