When you are not comfortable representing yourself during a tax audit or if you are not so well versed in the procedures, it will serve you well to hire tax professionals to represent you for your tax audit solutions. Once you are represented by reliable tax professionals, you do not even have to be present during the tax audit. This will definitely work in your favour. The biggest benefit of proper representation in tax audit solutions is that if you are in disagreement with some changes made by the CRA auditor or the result of the tax audit, your tax professional has the skills and the experience to take the case to a higher authority.
When faced with a tax audit, it is not a wise thing to run away from it or to ignore the Notice of assessment from the CRA. Failure to comply with the tax audit is a guaranteed path to get your tax options limited and create a whole world of ill will with the CRA auditors and also get your tax bill increased. Tax audit solutions demand that you get a proper representation for the tax audit.
The tax accounting firms will send in-house bookkeeping staff who will go through your records methodically and reorganise all your financial records to set up a complete financial picture which is ready for the tax audit, if necessary. The tax advisory staff will use reports to check the previous and current tax returns to answer all potential questions posed by the CRA auditors as part of their tax audit solutions. This is a good way to identify and then head the problems off before they even arise.
It is not a smart idea to be under a tax audit and waste all that precious time in answering to the CRA correspondence from their auditors and accommodating them on your business premises. When you seek professional help in tax audit solutions, you will get experienced help from accountants who are well versed with CRA policies as well as procedures.
You will feel that the correspondence from CRA is either in English or in French but it is actually in its own language. It is not easy for you to grasp it. It may be as good as a foreign language to you. More than the language or the technicalities, it is the confidence that you are ably represented when you seek professional help for your tax audit solutions. The CRA auditors will begin the tax audit by comparing your bank deposits and your bank statement to the income that you have reported on your tax return. They will also look at your general ledger and other records of bookkeeping. Your accountants will have to keep records to show as documents for the gifts you have received during the year. Without proper proof, the CRA will go ahead and categorise it as unreported income and tax you accordingly.
The auditors will also compare paid bills and credit card statements to the deductions you have reported on your returns. If you get good representation as part of your tax audit solutions, you may influence the CRA auditors to pay special attention to your reported business losses or debts.