Review versus audit: not the same thing
Most CRA contact is not an audit. A review asks you to substantiate specific claims — a childcare expense, a charitable donation, a vehicle deduction. It arrives as a letter requesting documents, is usually handled by correspondence, and closes in four to eight weeks once you respond.
An audit is a systematic examination of your books, typically covering one or more full tax years. An auditor is assigned, the scope is broader, and the process is materially longer. Confusing the two causes unnecessary alarm; most letters are reviews.
What drives the timeline
- How fast you respond. The single largest variable. Files where documents arrive complete and promptly close far sooner than files requiring repeated follow-up.
- Record quality. Organised, contemporaneous records shorten an audit dramatically. Reconstructed records extend it and invite further questions.
- Scope. A single-issue audit is quicker than a full examination of several years.
- Complexity. Related-party transactions, foreign income and shareholder loans all add time.
- Whether you dispute findings. Objections and appeals add months or years beyond the audit itself.
The stages you will go through
Initial contact — a letter or call identifying the auditor, the years under review and the scope. Establish the scope in writing early; it governs everything that follows.
Information requests — document demands, usually with a 30-day response window. Extensions are generally granted if requested before the deadline.
Examination — the auditor works through the records, often with follow-up questions. This is the longest phase.
Proposal letter — the auditor sets out proposed adjustments and allows a response period, typically 30 days. This is the most important point in the process and the last low-cost opportunity to change the outcome.
Reassessment — a formal notice issues. From here, disagreement means filing a Notice of Objection within 90 days.
How far back the CRA can go
The normal reassessment period is three years from the original notice of assessment for individuals and CCPCs, and four years for other corporations.
That limit disappears where there has been misrepresentation attributable to neglect, carelessness, wilful default, or fraud. In those cases the CRA can reassess any year, however old. Unreported foreign income and unfiled returns carry their own extended periods.
What to do when the letter arrives
Do not ignore it. Deadlines in CRA correspondence are real, and missing them removes options.
Do not send everything you have. Provide what is requested, accurately and completely. Volunteering records outside the stated scope invites the scope to widen.
Route contact through your accountant. Authorising a representative means questions are answered by someone who knows the technical position, rather than answered informally in a phone call that becomes part of the file.
Keep everything in writing. A written record of what was requested, provided and agreed protects you if the file changes hands or the auditor's recollection differs.
What it costs you
For any return we prepared, we handle CRA correspondence and audit response at no additional charge. That is not a promotional position — it is the natural consequence of filing returns whose figures are documented at the time. When every number has support in the file, responding is a matter of retrieval rather than reconstruction.
For returns prepared elsewhere, we quote audit representation as a fixed fee after reviewing the file and the CRA's letter, so you know the cost before engaging.
Reviewed for the 2025 tax year by Udit Gupta, Certified Tax Accountant.
General information, not advice for your specific situation —
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