This paper, presented at the Canadian Tax Foundation’s Atlantic Provinces Tax Conference, provides a comprehensive analysis of the Canada Revenue Agency’s audit and assessment procedures as of 2022. It examines how CRA exercises its audit powers, the legal boundaries of Requirements for Information, and the critical question of whether solicitor-client privilege extends to work performed by accountants in the context of tax planning.
CRA’s audit authority under ss. 231.1 and 231.2 of the Income Tax Act carries significant powers, but those powers are bounded by procedural fairness requirements that practitioners must understand to protect their clients.
Requirements for Information issued under s. 231.2 can compel disclosure of broad categories of documents, but taxpayers and their advisors retain the right to challenge overly broad or unreasonable requests through the Federal Court.
The scope of solicitor-client privilege for accountant work product remains a contested area in Canadian tax law, with significant implications for how accounting professionals structure their communications when engaged alongside legal counsel.
We implement corporate and trust reorganizations across all nine common law provinces.
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