Tax Controversy and Dispute Resolution:Tax memo: “Risk Assessment” – The CRA’s New Audit Approach

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The International and Large Business Dictorate of the Canada Revenue Agency (CRA) is changing the way it selects files for audit. Technical Newsletter No. 34, dated April 27, 2006, stated that “The CRA’s goal is to develop a useful and cost-effective program to better target its compliance efforts.” It appears the goal is now coming into play.

The CRA is replacing its conventional method of selecting files for audit with a “risk assessment” approach that targets taxpayers that may have the highest risk of non-compliance.