CRA Tax Audit Triggers and How to Handle an Audit

Published on: November 12, 2025

An audit is when CRA examines your tax return, records, and supporting documents to
verify compliance with tax laws.
Common Audit Triggers include:

  • Discrepancies with third‑party data (T4s, T5s)
  • Large or unusual expenses
  • Consistently claiming losses
  • Claiming personal expenses as business
  • Rounded amounts or high cash transactions
  • Frequent late filings or real estate transactions

How CRA Conducts an Audit:

  • CRA uses risk assessment systems to flag returns.
  • They may request documentation and conduct desk or field audits.
  • CRA must give notice and opportunity to respond.
    How to Handle an Audit:
    Be calm, responsive, and organized. Provide requested documents only. Seek professional
    representation if needed.

How eFile CRA Tax can help:
We analyze your situation, prepare documentation, represent you with CRA, and manage
appeals if necessary.

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