The Tax Chick Podcast Musings of a Tax Chick - Unpacking Canada Revenue Agency's Informal Disclosure Guidelines
Apr 4, 2025
Dive into the ins and outs of CRA proposal letters! Discover what these letters entail, the critical response deadlines, and how they can vary. Learn about the implications for large corporations and the stringent rules they face during audits. Uncover the importance of informal disclosure and what documents you can request from CRA to bolster your case. Amanda emphasizes the need to gather comprehensive audit information before challenging any reassessments. Tune in for actionable insights that could ease your tax burdens!
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Year-End Proposal Letter Surge
- Amanda Doucette experienced an unusually large flurry of CRA proposal letters at fiscal year-end, including final proposals after long silence.
- Many letters had large proposed tax increases, penalties, and short response windows that alarmed her.
Respond At Audit, Not Just Appeals
- When CRA issues a proposal letter, respond with documentation during the audit stage rather than waiting for appeals.
- Ask for reasonable extensions if needed because legislation and case law require reasonable response periods.
Why Deadlines Get Shortened
- Short response deadlines often signal either statute-barred years or internal CRA deadlines like fiscal year-end projects.
- CRA may ask for waivers to extend deadlines when limitation periods loom.