CRA Audits in British Columbia
Reviewed by the Commoner Law Editorial Team. Sourced from Canadian federal statutes and official sources. Provincial information reflects each province's own legislation and court rulings. Written in plain language for general understanding — this is educational content, not legal advice. Our editorial standards
What is this right?
The Canada Revenue Agency (CRA) has the power to audit any tax return under the Income Tax Act (Sections 231.1 and 231.2). An audit is a review of your records to make sure you reported your income and deductions correctly.
The Taxpayer Bill of Rights gives you 16 specific rights when dealing with the CRA. These include the right to be treated fairly and professionally, the right to complete and accurate information, and the right to be represented by someone you choose (Right #15).
An audit is not a criminal investigation. The auditor is checking your math and your records, not accusing you of a crime. You are required to keep your tax records for at least 6 years (Section 230).
If you disagree with the auditor's conclusions, you have the right to say so. You can request a meeting with a team leader, and if the CRA issues a reassessment you disagree with, you can file a Notice of Objection.
When does it apply?
This applies to every individual and business taxpayer in Canada.
- The CRA selects files for audit based on risk factors, random selection, industry-specific campaigns, or tips from third parties.
- Being audited does not mean you did something wrong — it is a routine part of the tax system.
What to Do If the CRA Is Auditing You in Canada
- Read the audit notification carefully — it will tell you which tax years and which items are being reviewed.
- Gather your records before the auditor's deadline. This includes receipts, bank statements, invoices, and contracts.
- Consider hiring a tax professional or representative — authorize them with Form T1013.
- Respond within the timelines given in the audit letter.
- If you disagree with the auditor's findings, put your disagreement in writing within 30 days.
- Ask to speak with the auditor's team leader if you cannot resolve the issue.
- File a Notice of Objection if the CRA issues a reassessment you believe is wrong.
What should you NOT do?
- Don't ignore the audit letter — the CRA will proceed without your input and you may lose your chance to explain.
- Don't destroy or hide records — this is a serious offence under the Income Tax Act.
- Don't send documents by regular email — use My Account, registered mail, or secure methods.
- Don't waive solicitor-client privilege without careful thought — talk to a lawyer first.
- Don't assume the auditor is always right — you have the right to challenge their conclusions.
How British Columbia differs from federal law
CRA audits in BC follow the same federal rules as elsewhere in Canada. However, BC's provincial sales tax (PST) is administered separately from the federal GST, so BC businesses may face audits from two tax authorities.
- The CRA audits federal income tax and GST. The BC Ministry of Finance separately audits PST compliance under the Provincial Sales Tax Act.
- If you receive a PST audit notice from the BC Ministry of Finance, it is a separate process from any CRA audit. PST auditors can review your records for up to 4 years back (or longer if fraud is suspected).
- BC businesses must keep PST records for at least 7 years after the year to which they relate.
- If you disagree with a PST assessment, you can request a review by the Minister of Finance and then appeal to the BC Supreme Court.
Additional Steps in British Columbia
For CRA audit issues, follow the standard federal process (see federal page). For PST audits, contact the BC Ministry of Finance at 1-877-388-4440. You have 90 days from a PST assessment to request a review. Consider hiring an accountant or tax lawyer experienced with both CRA and BC PST matters.
Relevant Law: Provincial Sales Tax Act, SBC 2012, c. 35, Part 8 (assessments and appeals); Income Tax Act, RSC 1985, c. 1 (5th Supp.) (federal)
Common Questions
When does cra audits apply?
This applies to every individual and business taxpayer in Canada.The CRA selects files for audit based on risk factors, random selection, industry-specific campaigns, or tips from third parties.Being audited does not mean you did something wrong — it is a routine part of the tax system.
What should I do if the Canada Revenue Agency is auditing my tax return?
Read the audit notification carefully — it will tell you which tax years and which items are being reviewed.Gather your records before the auditor's deadline. This includes receipts, bank statements, invoices, and contracts.Consider hiring a tax professional or representative — authorize them with Form T1013.Respond within the timelines given in the audit letter.If you disagree with the auditor's findings, put your disagreement in writing within 30 days.Ask to speak with the auditor's team leader if you cannot resolve the issue.File a Notice of Objection if the CRA issues a reassessment you be...
What mistakes should I avoid with cra audits?
Don't ignore the audit letter — the CRA will proceed without your input and you may lose your chance to explain.Don't destroy or hide records — this is a serious offence under the Income Tax Act.Don't send documents by regular email — use My Account, registered mail, or secure methods.Don't waive solicitor-client privilege without careful thought — talk to a lawyer first.Don't assume the auditor is always right — you have the right to challenge their conclusions.
CRA Audits in other states
Same topic, different jurisdiction. Pick the one that applies to you.