As the taxation system in Canada is mostly based on the honour system, each year the CRA conducts a number of review activities that promote awareness of and compliance with the laws it administers. These reviews are in place in order to maintain the integrity of the Canadian tax system.
If you should receive a letter from the CRA stating that they are conducting a pre-assessment review, please don’t be alarmed. This is NOT an audit. It’s merely a systematic spot checking of the system. Even if something is noted during the review that cannot be supported, CRA would typically just disallow the specific item claimed.
At DSK, we’re happy to handle these reviews for our clients at no additional charge. This type of work is built into our fee structure, eliminating any additional and unexpected cost to you at time of review. Just bring the letter into our office, and leave it to us to provide any documentation that’s requested by CRA.