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CRA Audit Support · Healthcare · Licensed CPA

CRA Audit Support for Healthcare Businesses

If the CRA is reviewing your medical or dental corporation, we take it over. We handle the issues that hit healthcare practices hardest, shareholder benefits, HSA and health plan claims, GST/HST on cosmetic and uninsured billings, and vehicle and home-office deductions, and we deal with the auditor directly. Licensed Ontario CPA. Flat fee. All fees include HST.

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We Deal With the CRA for You
Authorized Representative
We register with the CRA and deal with the auditor directly
Proposal Stage Response
We answer before a reassessment is ever issued
Objections & Appeals
Filed within the 90-day window to the Appeals Division

A Healthcare Audit Turns on Issues a Generalist Misses

The CRA pays particular attention to incorporated doctors and dentists, and a healthcare audit rarely turns on the basics. It turns on whether health and dental plan payments are a real employment benefit or a shareholder benefit, whether GST/HST was apportioned correctly on taxable billings, and whether personal and corporate spending stayed separate. The burden of proof sits with you, so the outcome depends on how these specific issues are handled.

We step in as your authorized representative, deal with the auditor directly, and defend the positions your practice actually took, with the documentation and the law behind each one. Where the CRA proposes adjustments that are wrong, we push back at the proposal stage and, if needed, object and appeal. See our CRA audit resolution services, our work for doctors and healthcare providers.

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Gondaliya CPA team

Our Healthcare Audit Support Services

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Audit Response

We take over the CRA review of your medical or dental corporation as your authorized representative.

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Shareholder Benefit Defence

We defend health plan, HSA and expense claims the CRA tries to recharacterise as shareholder benefits.

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GST/HST on Billings

We defend how you apportioned input tax credits between exempt and taxable cosmetic or uninsured billings.

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Proposal Letter Response

We answer the auditor's proposal before it becomes a reassessment, reducing or removing adjustments.

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Objections & Appeals

Where the CRA is wrong, we file the Notice of Objection and take the file to Appeals and Tax Court.

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Penalty & Interest Relief

We dispute wrong penalties and pursue taxpayer relief where circumstances were beyond your control.

How We Defend a Healthcare Audit

Every stage of an audit handled correctly, from the first letter to the final result. All fees include HST.

1

Take Over the Audit

The first response sets the tone. We make sure the CRA deals with us, not your front desk.

  • Register as your authorized representative so the auditor deals with us directly.
  • Review the letter to pin down the exact corporation, years and issues in scope.
  • Confirm deadlines and secure a reasonable extension where the file needs it.
  • Keep the audit from expanding into other years by answering only what was asked.
  • Explain your options and the likely path in plain language before we act.
2

Shareholder Benefit & HSA Claims

This is where most healthcare audits are won or lost.

  • Show that health and dental plan payments are a genuine employment benefit, not a shareholder benefit.
  • Support Health Spending Account and PHSP claims with the plan documents and eligibility.
  • Rebut attempts to recharacterise a claim as a personal benefit and add it to your income.
  • Separate what the corporation properly paid from what was personal to you.
  • Defend the deduction with the structure and the case law behind it.
3

GST/HST on Your Billings

Mixed billings are a common and costly audit issue for practices.

  • Confirm which services are exempt and which, like cosmetic or uninsured work, are taxable.
  • Defend how input tax credits were apportioned between exempt and taxable activities.
  • Correct over-claimed input tax credits before they become a full assessment.
  • Document the apportionment so it holds up and is applied consistently.
  • Handle any GST/HST registration and filing gaps the audit surfaces.
4

Expense & Deduction Review

Healthcare deductions draw scrutiny when the documentation is thin.

  • Support vehicle claims with a mileage log for clinic, hospital and home-visit travel.
  • Back conference, CME, licensing, CMPA and liability insurance costs with records.
  • Match home-office and equipment claims to a defensible basis.
  • Separate personal spending the CRA flags as run through the corporation.
  • Present every deduction under review with the receipt or invoice behind it.
5

Income Splitting & Compensation

Family payments and the salary-dividend mix invite questions.

  • Defend salary or dividends paid to family against the TOSI rules.
  • Show that amounts paid for real work are reasonable for the work done.
  • Support the salary and dividend mix taken from the corporation.
  • Address shareholder loan balances the CRA reviews for benefit inclusions.
  • Reconcile the personal and corporate returns so they tell one story.
6

Object, Appeal & Fix the Cause

If the reassessment is wrong, the fight is not over.

  • File the Notice of Objection within 90 days to reach the independent Appeals Division.
  • Make the legal and factual case to Appeals, separate from the audit team.
  • Advise on paying or deferring the disputed amount while interest is running.
  • Take the file to the Tax Court of Canada where the numbers justify it.
  • Fix the bookkeeping and structure so the next year is audit-ready.

Free Healthcare Audit Support Consultation

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Free Healthcare Audit Support Consultation

How Far Back the CRA Can Reassess

The reassessment period decides which years are open and how long you must keep records. Here is how it works for a small business.

SituationReassessment Period
CCPC or individual, normal case3 years from the Notice of Assessment
Other (non-CCPC) corporations4 years from the Notice of Assessment
Foreign property (T1135) or loss carrybacks6 years
Misrepresentation, neglect, carelessness or fraudNo time limit
Record retention requirement6 years from the end of the tax year

"Statute-barred" is not automatic protection. A year past the normal period is generally closed, but the CRA can reopen it where it alleges misrepresentation from neglect, carelessness or wilful default, and that allegation is made more often than owners expect. How the audit is handled affects whether that door stays shut.

What Triggers a Healthcare Practice Audit

TriggerWhat the CRA Sees
Shareholder benefit blurPersonal costs paid by the corporation without proper structure
Health plan & HSA claimsPlans provided only to the owner, presumed a shareholder benefit
GST/HST on mixed billingsInput tax credits over-claimed on exempt versus taxable services
High deductionsVehicle, home-office and expense claims large relative to billings
Vehicle claims without logsMileage deducted with no log for clinic and hospital travel
Income splittingSalary or dividends to family that draw TOSI questions
Foreign assets (T1135)Foreign property and income not reported on the T1135

Audits are rarely random. The CRA runs your return through data-matching and industry benchmarking, so most audits start from a discrepancy the system flagged. Clean books that reconcile to your slips are the best way to stay off that list. See our accounting and bookkeeping.

Types of Healthcare Audit We Handle

Audit TypeWhat It Examines
Corporate income tax (T2)MPC revenue, deductions, expenses and the salary-dividend mix
GST/HSTExempt versus taxable billings and input tax credit apportionment
Shareholder benefit reviewHealth plans, HSA claims and personal costs paid by the corporation
PayrollSource deductions, associate classification and taxable benefits
Review letterA narrower request to support a specific claim or deduction

What Our Healthcare Audit Support Includes

  • Registering as your authorized representative and taking over CRA communication
  • Reviewing the audit scope, years and deadlines and explaining your options
  • Preparing the records behind your health plan, HSA, GST/HST and expense claims
  • Dealing with the auditor directly and keeping the audit contained
  • Responding to the proposal letter to reduce or remove adjustments
  • Filing the Notice of Objection and representing you at Appeals
  • Advising on paying or deferring the disputed amount while interest runs
  • Pursuing relief from penalties and interest where warranted
  • Fixing the structure and bookkeeping so your practice is audit-ready going forward

Know Your Exact Fee Before We Start

Flat fee, fixed in advance. All fees include HST. No hourly billing.

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Case Studies

Shareholder Benefit Reversed

The CRA proposed to recharacterise a doctor's health and dental plan payments as a shareholder benefit and add them to personal income. We produced the plan documents and the employment relationship supporting them, and the benefit treatment held. The figures here are illustrative of the work we do, not a specific client file.

Benefit inclusion reversed

GST/HST Apportionment Upheld

A clinic with both insured and cosmetic billings was assessed for over-claimed input tax credits. We rebuilt the apportionment between exempt and taxable activities, documented it, and most of the proposed assessment was withdrawn. The figures here are illustrative of the work we do, not a specific client file.

Most of the assessment withdrawn

Vehicle & Expense Claims Held

A dentist faced disallowed vehicle and home-office deductions for lack of support. We reconstructed the mileage and matched every expense to its receipt, and the bulk of the claims were allowed. The figures here are illustrative of the work we do, not a specific client file.

Bulk of deductions allowed

Objection Won at Appeals

A reassessment on an incorporated physician stood on an auditor's error the audit team would not reverse. We filed a Notice of Objection within the 90 days and made the case to the independent Appeals Division, which vacated the adjustment. The figures here are illustrative of the work we do, not a specific client file.

Reassessment vacated at Appeals

Why Choose Gondaliya CPA for Healthcare Audit Support?

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Healthcare Expertise

We know MPC rules, shareholder benefits and mixed-billing GST/HST.

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We Deal With the CRA

You never face the auditor alone; we handle it all as your representative.

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Flat Fee, Upfront

All fees including HST, no hourly billing, no surprises.

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Fully Remote

Your audit handled through our secure portal, wherever you are.

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Transparent Flat-Fee CRA Audit Support Pricing

ServiceFeeFrequencyDetails
Initial Audit Review & OptionsFREEOne-timeWe review the CRA letter, confirm the years and deadlines, and explain your options.
Review Letter ResponseQuoted upfrontPer matterWe respond to a narrower CRA review of a specific claim or slip on your behalf.
Full Audit RepresentationQuoted upfrontPer matterWe take over the audit end to end, prepare records and deal with the auditor.
Proposal Letter ResponseQuoted upfrontPer matterWe rebut proposed adjustments with documentation before a reassessment issues.
Notice of Objection & AppealsQuoted upfrontPer matterWe file the objection and represent you at the independent Appeals Division.

All fees include HST, so the number quoted is the number you pay. Payment is by Interac e-Transfer to info@gondaliyacpa.ca with auto-deposit enabled and the security question set to Not Applicable. Please use our pricing calculator for an exact figure.

Know Your Exact Fee Before We Start

Flat fee, fixed in advance. All fees include HST. No hourly billing.

Calculate My Fee

Healthcare Audit Support: Cities We Serve

Licensed CPA audit support for medical and dental practices across Ontario, delivered virtually.

TorontoMississaugaBramptonScarboroughEtobicokeNorth YorkMarkhamVaughanOttawaAll of Ontario

Frequently Asked Questions

What is a CRA audit?
A CRA audit is a detailed examination of your business's tax returns, financial records and supporting documents to confirm that what you reported is accurate and complete. Most audits are not about catching fraud; they are about verifying documentation. With clean records and proper representation, an audit is usually a matter of proving your numbers rather than disputing adjustments.
Why was my practice selected for a CRA audit?
The CRA pays particular attention to incorporated doctors and dentists. Common triggers are health plan and HSA claims that look like a shareholder benefit, personal costs run through the corporation, GST/HST input tax credits over-claimed on mixed billings, and vehicle or expense deductions without support. Some files are still selected at random.
What are the most common audit triggers for a healthcare practice?
The biggest ones for incorporated healthcare professionals are shareholder benefit issues where personal costs are paid by the corporation, health and dental plan or HSA claims provided only to the owner, GST/HST input tax credits over-claimed on cosmetic or uninsured billings, vehicle claims without a mileage log, and income splitting with family. We review your return against these before they become a problem.
How far back can the CRA audit my business?
For a Canadian-controlled private corporation or an individual, the normal reassessment period is three years from the date of the Notice of Assessment. For other corporations it is four years. It extends to six years for foreign-property and loss-carryback matters, and there is no time limit at all where the CRA alleges misrepresentation, neglect, carelessness or fraud.
What is the normal reassessment period?
It is the window in which the CRA can reassess a return as of right. Under the Income Tax Act it is three years from the original Notice of Assessment for a CCPC or individual, and four years for other corporations. Once that period passes, a year is generally statute-barred and cannot be reopened unless misrepresentation or fraud is involved.
Can the CRA go back more than six years?
Yes, in specific cases. Where the CRA alleges misrepresentation attributable to neglect, carelessness or wilful default, or outright fraud, there is no time limit on reassessment. This is a powerful tool and it is used more often than owners expect, which is why how the audit is handled from the start matters so much.
How long do I have to keep my business records?
At least six years from the end of the tax year they relate to. For capital property, keep the records for six years after you dispose of the property. The CRA accepts organized digital copies. Good record retention is your single best defence in an audit, because the burden of proof is on you, not the CRA.
What records will the CRA ask for?
Typically your sales records and invoices, expense receipts and vendor invoices for every deduction, complete bank statements for business and any personal accounts used for business, payroll records, contracts, and your general ledger. The auditor tests whether your reported numbers are supported. An expense with no document behind it is the first thing disallowed.
What happens during a CRA audit?
The CRA requests records, examines them, and may ask questions or interview you. The auditor then issues a proposal letter setting out any adjustments they intend to make, and you have a chance to respond before anything is finalised. Only after that does a formal Notice of Reassessment issue. How you respond to the proposal letter often decides the outcome.
What is a proposal letter?
It is the letter the auditor sends near the end of the audit setting out the adjustments they propose to make and why, before issuing a formal reassessment. It is a critical opportunity, because a well-supported response at this stage can reduce or eliminate adjustments without ever needing a formal objection. We prepare that response for you.
What if I disagree with the audit result?
You can file a Notice of Objection within 90 days of the reassessment. That triggers an independent review by the CRA's Appeals Division, which is separate from the audit team. If Appeals still rules against you, the next step is the Tax Court of Canada, where taxpayers succeed more often than many expect. We handle the objection and the appeal.
What is a Notice of Objection?
It is the formal document that disputes a reassessment and sends the file to the CRA's independent Appeals Division for a second look. It must be filed within 90 days of the reassessment for individuals and CCPCs. Missing that deadline is one of the most damaging mistakes in an audit, because it can cost you the right to dispute the result.
Do I have to pay the reassessed amount while I object?
Generally the disputed amount, or at least the undisputed portion, should be paid, because interest continues to accrue while the objection is pending even though the tax is disputed. You can ask the CRA to defer collection action during the objection, but interest is not waived. We advise on managing this so interest does not compound against you.
Who has the burden of proof in a CRA audit?
You do. Under the Income Tax Act the burden of proof rests on the taxpayer, not the CRA. That means it is up to you to demonstrate that your income was correctly reported and your deductions were valid, with documentation. This is why records and representation matter so much, and why an unsupported figure usually loses.
Should I talk to the CRA auditor myself?
You can, but it is rarely wise to do it alone. Casual answers to an auditor can widen the scope of an audit or create issues that were not there. As your authorized representative, we manage the communication through your business account, answer precisely, and keep the audit focused on the year and issues at hand rather than letting it expand.
What is the Taxpayer Bill of Rights?
It is a set of rights that govern how the CRA must treat you, including the right to be treated professionally and fairly, the right to complete and accurate information about your obligations, the right to privacy and confidentiality, and the right to object and appeal to an independent body. If an auditor acts improperly, the Taxpayers' Ombudsperson can be involved.
Can a CRA audit expand to other years?
Yes. If the auditor finds significant or recurring errors in the year under review, the CRA can expand the audit to prior years within the reassessment period. This is one reason an audit should be handled carefully from the outset, since a loose answer or a single unsupported item can open up additional years of exposure.
How does GST/HST apply to my practice in an audit?
Most medical and dental services are exempt from GST/HST, but cosmetic procedures, independent medical assessments and other uninsured services can be taxable. A practice with both must apportion its input tax credits and claim only the taxable-activity portion. Over-claimed input tax credits are a frequent assessment, and we defend the apportionment you used.
What is a shareholder benefit, and why does it matter in a healthcare audit?
A shareholder benefit is a personal cost the corporation paid for you as its owner. Where a doctor is both shareholder and employee, the CRA looks closely at health plans, HSA claims and expenses, and a plan provided only to the controlling owner is often presumed a shareholder benefit unless the facts support otherwise. If recharacterised, the deduction is denied and the amount is added to your income. We defend the employment basis for these claims.
What is a net worth audit?
It is an indirect method the CRA uses when it believes income is understated, estimating your income by measuring the growth in your net worth and personal spending against what you reported. These assessments are often inflated and rest on assumptions that can be challenged with proper records. We defend net worth assessments by rebuilding the real numbers.
How much does a CRA audit cost my business?
Beyond any reassessed tax, the cost is in time, stress, interest and, where adjustments are wrong, tax you did not actually owe. Professional representation usually costs a fraction of the exposure and often reduces the reassessment well below where it started. We quote a flat fee upfront so you know the cost before we begin. All fees include HST.
Can you help if I already received an audit letter?
Yes. We review exactly what the CRA has asked for, organise and prepare your records, respond to the auditor on your behalf, and address the proposal letter before it becomes a reassessment. The earlier we are involved, the more we can shape the outcome, so it is best to call us as soon as the letter arrives rather than after.
What if the CRA already reassessed me?
We can still act. If you are within 90 days of the reassessment we file a Notice of Objection and take the file to the independent Appeals Division. If the deadline is close or passed, there may still be options, including a request for an extension in limited circumstances. The sooner you contact us after a reassessment, the more we can do.
Can you reduce the penalties and interest?
Often, yes. Where adjustments are wrong we dispute them, which removes the associated penalties and interest. Where a genuine error occurred, we can pursue taxpayer relief for penalties and interest caused by circumstances beyond your control. We cannot promise a specific outcome, but reducing penalties and interest is a core part of what audit support achieves.
Do cosmetic and uninsured services raise my audit risk?
They can, because they change your GST/HST position. Once a practice provides taxable services like cosmetic procedures alongside exempt insured care, the input tax credit apportionment has to be right, and getting it wrong is a common assessment. Clean records that separate exempt and taxable billings are the defence, and we build them so the practice can withstand review.
Will an audit affect my future returns?
It can. Once the CRA has audited you and found issues, your file carries a higher risk profile, and recurring problems can prompt further reviews. Resolving the audit cleanly and fixing the underlying bookkeeping or classification issue is what lowers that risk going forward, which is why we address the cause, not just the current year.
Do you handle audits across Ontario?
Yes. We are a licensed Ontario CPA firm and we support healthcare practices through CRA audits across Ontario and Canada, entirely remotely. Everything is handled through our secure portal and directly with the CRA on your behalf, so your location is never a constraint and you are represented wherever your business operates.
How do I reduce my risk of being audited?
Keep clean books that separate exempt and taxable billings, structure health plans and HSAs properly so they are not shareholder benefits, document vehicle and expense claims, and keep personal and corporate spending apart. Proactive bookkeeping and a yearly review are the most effective protection. See our accounting and bookkeeping services.
How much does your CRA audit support cost?
We quote a flat fee upfront based on the type and scope of the audit, with no hourly billing, so you know the cost before we start, and all fees include HST. Please use our pricing calculator or book a consultation for an exact figure.
How do I get started?
Please book a free consultation and tell us what you have received from the CRA, whether it is a review letter, an audit notice, a proposal letter or a reassessment, and the years involved. We review your situation, explain your options and deadlines, quote a flat fee, and take over dealing with the CRA. Book Free Consultation →

Meet Your Healthcare Audit Support Team

Sharad Gondaliya, CPA

Sharad Gondaliya, CPA

Founder & Managing Director
Gondaliya CPA Professional Corporation

Sharad represents incorporated doctors, dentists and clinics through CRA audits, objections and appeals.

Vandana Goel, CPA

Vandana Goel, CPA

Senior Accountant
Gondaliya CPA Professional Corporation

Vandana prepares the records, reconciliations and working papers that carry a medical or dental practice through an audit.

What Our Clients Say

1300+ five-star reviews from business owners across Ontario and Canada.

Related Services We Provide

CRA Audit Resolution Services

  • Reassessment disputes and objections
  • Appeals Division representation
  • Penalty and interest relief requests

Accounting for Doctors

Accounting & Bookkeeping

  • Clean, reconciled books that lower audit risk
  • Income matched to third-party slips
  • Audit-ready record keeping

Dental Accounting Services

  • Unfiled and late corporate returns
  • Bringing prior years current
  • Relief where available

Got a CRA Letter About Your Practice? Do Not Face It Alone.

We take over the audit, defend the shareholder benefit, HSA and GST/HST positions your practice took, and fight adjustments that are wrong. Flat fee. All fees include HST.

Licensed CPA Ontario
1300+ Five-Star Reviews
We Deal With the CRA
Flat-Fee, Including HST
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