Tax Tip Thursday

We have been seeing a lot of reviews occurring these days. They are like a mini audit. They are usually pretty straightforward to deal with, but they definitely cannot be ignored! Don’t be scared, though. They are not a big deal and you can easily respond to one.

Unfortunately, the government is short on funding these days and tax dollars are where they are going to get more funding. Conducting a review is a GREAT source of funding for them. Unfortunately many people just can’t be bothered to comply, or worse yet, cannot provide the requested documentation. These both result in reassessments and, or course, additional taxes payable.

What Is a Review?

A review is usually just a request for some documentation supporting certain line items on your tax returns. Some of the more common reviews:

• vehicle mileage logs,
• medical expenses and donations,
• legal expenses claimed for getting support,
• copies of slips for foreign income, and
• proof of property taxes.

You are given 30 days and, truth be told, all you have to do is call in if you need more time and they will give it to you.

These are not difficult to handle. You just need to take a few minutes to read the letter carefully. In order to save paper, they are now providing a website where you have to go to acquire the details of the request (rather than send an extra page or two to the taxpayer). Just go to the website in the letter and follow the instructions there.

You will need to write a letter identifying what you are providing and how it satisfies their request. you can upload the letter and documentation directly through your MyCRA account (see my post about that from last week), or you can fax or mail it in (although this is by far the least secure and slowest method of getting information to the CRA).

Our Services

Many people come to us for help with these. We have had some people suggest that this service should be included as part of our tax preparation service at no additional cost, but this is just not possible. These reviews are time consuming to handle and are time sensitive, and we have already had over 100 of them this year alone.

However, because this is such a popular request, we will be coming out with new pricing this year to accommodate those who would like an all-in cost! We will have three levels of tax preparation services available to people and I will leave it to you to decide which is best for your situation. Stay tuned for details!

The best way for you to keep more of your money in your pocket is to take some time and complete the CRA review response yourself.

Failing that, we are happy to help! Book an appointment today to learn more.

Disclaimer:

This article provides information of a general nature only. It is only current at the posting date. It is not updated and it may no longer be current. It does not provide legal or tax advice nor can it or should it be relied upon. All tax situations are specific to each individual. If you have specific tax questions you should book an appointment for a 1 on 1 consultation.