If any of the questions above apply to your organization, you may need to re-think your tax risk management strategy.
The Canada Revenue Agency (CRA) announced that they will change the way they select files for auditing by replacing its conventional selection method with a new risk assessment approach, focusing on companies they think will most likely to fail to comply with legislation. This mirrors the global trend towards greater cooperation between countries’ tax authorities and the resulting increased enforcement.
As a result of government authority’s heightened scrutiny and the risk of audit, we expect chief executives and board of directors to take an increased interest in ensuring that tax risk is managed.
To address this new audit reality, companies will be compelled to recognize, quantify and address their tax risk and the resulting CRA profile. Managing tax risk is not about minimizing risk, but rather is about optimizing risk and value by determining what risk level is acceptable to your organization. That tax risk should be aligned with the company’s broader corporate strategy, then managed and monitored.
Contact a member of our team to help your company plan for and manage this new level of enforcement.