GST/HST Audits on Property Sales
The Canada Revenue Agency (“CRA”) has been reviewing property purchases and sales for years. More recently, they have started GST/HST audits which accuse taxpayers of building their own homes and selling them as part of a business. They claim taxpayers are builders and not subject to any exemption from charging GST/HST on the eventual sale of the...
Property Flipping Audits
The Canada Revenue Agency (“CRA”) has been going after those who buy and sell homes in quick succession for years. More recently, they have turned their attention to those who have bought and sold just one home in a short period.Property Flipping Audits – How does CRA know? They have staff who sit in land titles office reviewing for names coming...
Determining The Taxability Of A Supply For GST/HST
The Tax Court of Canada decision in A-Supreme Nursing & Home Care Services Inc. v. The King, 2023 TCC 39 (“ANHC”), involved a CRA audit of a staffing agency in the business of supplying healthcare workers, resulting in a reassessment for over $1,000,000 in GST/HST. The decision is of interest as it clarifies the scope and...
The Proposed Residential Property Flipping Rule
The Proposed Residential Property Flipping Rule
The Residential Property Flipping deeming rule introduced in the 2022 Federal Budget will not apply if the disposition of residential property is on account of a “life event”. Accordingly, it appears that Canada Revenue Agency (CRA)...
Denied ITCs & the GST/HST Rebate For ‘Tax Paid In Error’
Subcontractor Expenses, Denied ITCs And The GST/HST Rebate For ‘Tax Paid In Error'
In Mediclean Incorporated v. The Queen, 2022 TCC 37 (CanLII), the Tax Court of Canada provides guidance for successfully claiming the “tax paid in error” GST/HST rebate and reiterates the...
Budget 2021: CRA can Compel Oral Interviews
CRA can Compel Oral Interviews - Cameco - 2021 Federal Budget
Oral Interviews, CRA Audits and the Cameco Decision
In did not take long for the Federal government to nullify the decision in Canada (National Revenue) v. Cameco Corporation, 2019 FCA 67 (CanLII). In Cameco, the Federal Court of Appeal...
TFSA Penalties
Tax Free Savings Account (TFSA) Penalties
CRA Rules for Tax Free Savings Account Investments
The TFSA can be an effective investment and tax savings vehicle. In general, gains in the account remain tax free. However, there are very strict rules regarding...
CRA Net Worth Audit Explained
Net Worth Audit
What is a CRA Net Worth Audit?
A standard audit will involve a review of a taxpayer’s accounting and related records (e.g. bank statements). However, if the Canada Revenue Agency (“CRA”) considers a taxpayer’s records insufficient they may utilize the...
Can CRA Force a Taxpayer to Deliver Documents for Audit?
Canada (National Revenue) v. Montana, 2019 FC 900
As established in multiple decisions, including Canada (National Revenue) v. Cameco Corporation, 2019 FCA 67 (CanLII), CRA has the authority to compel a taxpayer to “provide” CRA with the documents they wish to audit. But what is the definition of...
CRA Audits of Tax Free Savings Accounts (TFSA)
CRA Audits & TFSA Penalties
Audits of Tax Free Savings Accounts - Louie v. Canada, 2019 FCA 255 (CanLII)
Tax-Free Savings Accounts (“TFSA”) are regularly audited by the Canada Revenue Agency (“CRA”). One reason being is that there are opportunities to abuse the “tax free” element beyond the...