CRA Audit Representation Cost Estimator
A letter from the CRA is not all the same thing. Work out roughly what representation costs for the type of review you have actually received, how your records affect that, and whether the cost is proportionate to what is at stake.
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Where the Time Goes
| Stage | What Happens | Hours | At the Rate |
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What Moves the Number
| Factor | Your Position | Effect |
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What Representation Covers
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Points That Decide This
What to Do Next
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Disclaimer: The figures on this page are a rough estimate of professional fees generated from the inputs you provide, and are not a quotation, an offer, or a fee that we or any other firm is bound by. Actual cost depends on matters that cannot be assessed from a web page, including the questions the auditor asks, the volume and condition of the records, how quickly information is produced, whether the issues raised expand during the review, and whether other advisers are involved. Nothing on this page is a prediction or assurance of any outcome. Representation does not guarantee that an assessment will be reduced, that no reassessment will be issued, that penalties will be cancelled, or that any particular position will be accepted; the result of a review depends on the facts, the records that exist, and the law. The hourly rate shown is an editable placeholder and not our rate, which is quoted after we understand the engagement. Where bookkeeping has to be reconstructed, that is accounting work billed separately from representation and may be required regardless of the review. Statutory deadlines apply to a review and to anything that follows it, including the period in which a notice of objection may be filed after a notice of assessment or reassessment is issued, and those deadlines are strict and generally measured from the date on the notice rather than the date it is received. Missing a deadline can end a dispute irrespective of its merits. This page is general information, not tax, accounting or legal advice, and it is not a substitute for advice on your own circumstances. Where a review involves a criminal investigation, suspected fraud, or an unreported-income matter, independent legal advice should be obtained before anything is sent to the CRA.
Not Every Letter Is an Audit
The most useful thing to establish first is what you have actually received. A request for a few receipts is a processing review and is ordinarily answered in an hour or two. A full corporate audit is a different animal entirely, and the gap in cost between them is enormous.
People routinely panic at the first and underestimate the second. Reading the letter carefully, and in particular which years and which items it names, tells you most of what you need to know about the scale of what is coming.
The letter also sets the first deadline. Most requests give a date for a reply. Asking for more time is normal and usually granted if you ask before the date rather than after it, and that single step prevents a surprising number of problems.
What Representation Actually Does
It is worth being plain about this, because the value is real but it is not what people sometimes imagine. Representation does not guarantee an outcome. Nobody can promise that an assessment will be reduced or that penalties will be cancelled, and any firm that does should be treated with suspicion.
What it does is manage the process. Information goes out in an organised form, questions are answered once rather than three times, only what has been asked for is provided, deadlines are met, and the position is documented as it develops rather than reconstructed later.
| Representation does | Representation does not |
|---|---|
| Manage correspondence and deadlines | Guarantee any outcome |
| Present records in a usable form | Create records that do not exist |
| Limit disclosure to what is required | Withhold what is lawfully required |
| Preserve objection rights | Extend a statutory deadline |
Records Drive the Cost More Than the Issue Does
Two corporations facing the identical audit question can incur very different fees, and the difference is almost always the state of the records. Where everything reconciles and the supporting documents are filed, the work is assembly. Where it does not, the work is reconstruction.
That reconstruction is bookkeeping rather than representation, and it is worth separating the two in your mind. It is often work that needed doing anyway, and the audit has merely brought the deadline forward.
Volunteering extra material usually costs money and rarely helps. Answering a question about one year with documents covering three invites questions about the other two. Providing what was asked, properly, is both cheaper and safer than providing everything.
Proportionality Is a Legitimate Question
Where the amount in dispute is modest, spending more on professional fees than the tax at issue is not sensible, and it is reasonable to say so. Sometimes the right advice is to pay the adjustment and move on.
That calculation changes where the same issue repeats across years, or where accepting a position this year invites the same adjustment every year after. Then a small current amount is standing in for a much larger recurring one, and the arithmetic looks quite different.
The Objection Deadline Is Separate and Strict
If a reassessment is issued and you disagree, there is a limited period to file a notice of objection, running from the date on the notice rather than the date you opened it. Missing it can end the matter regardless of the merits.
An objection is its own stage with its own cost, and it is not included in the estimate of handling the audit itself. Knowing that before the reassessment arrives is better than discovering it afterwards.
Some reviews need a lawyer, not an accountant. Where the matter involves a criminal investigation, suspected fraud, or substantial unreported income, independent legal advice should be obtained before anything is sent. That is a different protection from the one an accountant provides.
What This Estimate Does Not Include
- Any prediction of the outcome, which nobody can give
- An objection or appeal, which is a separate stage
- Legal fees where a lawyer is needed
- Catch-up filing of returns that were never filed
- Interest and penalties that may be assessed
- A quotation, which follows a conversation about the actual file
Send us the letter before you reply to it. A short consultation starts by establishing what has actually been asked, what the deadline is, and what it will take to answer properly. We will tell you plainly where the cost is likely to exceed what is at stake.
Frequently Asked Questions
Common questions on audit representation.
Related Calculators and Guides
More on CRA reviews and disputes.
Send Us the Letter Before You Answer It
We will tell you what has actually been asked, what the deadline is, what it will take to answer properly and what that is likely to cost. If the cost looks like exceeding what is at stake, we will say so rather than taking the engagement.