6 worked Accounting Records Cleanup case studies — the position a client typically comes to us with, what we do, and what it is worth. Each is an illustrative example built on the rules that apply to accounting records cleanup work, not a specific client's file.
Case Study 1 · Sale and succession
Share Sale Restructured, $320,000 Less Tax On Closing — Dental Hygiene Clinic, Lethbridge
Client: A dental hygiene clinic · Where: Lethbridge, Alberta · Engagement: 9 weeks, fixed fee
Tax saved on closing$320,000
PriceAs agreed
Post-closing adjustmentsNone
The situation — A dental hygiene clinic, Lethbridge, Alberta
A dental hygiene clinic in Lethbridge, Alberta was preparing to sell. Due diligence surfaced a single shareholder holding every share, with no room to multiply the exemption. That would have reduced the price or killed the deal outright.
What we did for A dental hygiene clinic, Lethbridge, Alberta
We cleaned up the historical file. We recoded the meals and entertainment accounts to the statutory limit and reversed the over-claimed input tax credits before the next return went in. Then we prepared the due-diligence package the buyer's advisers actually asked for.
The result — A dental hygiene clinic, Lethbridge, Alberta
The deal closed at the agreed price. $320,000 of tax was saved against the structure originally proposed, with no post-closing adjustment.
Case Study 2 · Records and systems rebuilt
12 Months Reconciled And $11,500 Of Input Tax Recovered — Multi-Processor Online Seller, Burnaby
Client: An online seller reconciling three payment processors · Where: Burnaby, British Columbia · Engagement: 4 weeks, fixed fee
Months reconciled12
Input tax recovered$11,500
Close time10 days
The situation — An online seller reconciling three payment processors, Burnaby, British Columbia
Nothing reconciled at an online seller reconciling three payment processors in Burnaby, British Columbia. Every filing started with 12 months of cleanup. The file was carrying eighteen months of unreconciled transactions and a shoebox of receipts.
What we did for An online seller reconciling three payment processors, Burnaby, British Columbia
We rebuilt from source rather than correcting on top of the existing file. We separated the owner’s personal spending out of the corporate accounts and cleared the resulting shareholder loan properly. Then we set the routine that keeps it clean.
The result — An online seller reconciling three payment processors, Burnaby, British Columbia
12 months reconciled to the bank. The close now takes 10 days, and $11,500 of previously unclaimable input tax was recovered in the process.
Case Study 3 · Missed incentive claimed
$104,000 In Credits Claimed That Prior Filings Had Missed — Owner-Operated Trades Business, Calgary
Client: An owner-operated trades business · Where: Calgary, Alberta · Engagement: 4 weeks, fixed fee
Credits claimed$104,000
Years adjusted3
Review outcomeNo adjustment
The situation — An owner-operated trades business, Calgary, Alberta
An owner-operated trades business in Calgary, Alberta had been filing for 3 years. In that time, the incentives its activity qualified for were never claimed. Behind that sat a payroll clearing account that had never been brought to zero, carrying a balance nobody could explain.
What we did for An owner-operated trades business, Calgary, Alberta
We tested each activity against the eligibility criteria rather than the description on the invoice. Then we cleared the payroll and sales tax clearing accounts every month and tied each remittance to the liability it settled.
The result — An owner-operated trades business, Calgary, Alberta
$104,000 in credits claimed, with the open prior years adjusted as well. The claim passed review without adjustment.
Case Study 4 · Deadline rescue
$43,000 Late-Filing Penalty Cancelled On Relief Application — Mobile Pet-Grooming Company, Regina
Client: A mobile pet-grooming company · Where: Regina, Saskatchewan · Engagement: 7 weeks, fixed fee
Penalty cancelled$43,000
Relief applicationGranted
ReturnAccepted as filed
The situation — A mobile pet-grooming company, Regina, Saskatchewan
A mobile pet-grooming company in Regina, Saskatchewan had already missed one deadline and was about to miss a second. Behind it sat meals and entertainment coded at full cost with the input tax credit claimed on the whole amount. A penalty of $43,000 was accruing.
What we did for A mobile pet-grooming company, Regina, Saskatchewan
We split the work into what had to happen before the deadline and what could follow it. Then we rebuilt sales from the processor settlement reports so gross sales, fees and refunds each landed in an account of their own.
The result — A mobile pet-grooming company, Regina, Saskatchewan
The outstanding return was accepted as filed, and the taxpayer relief application cancelled $43,000 of the penalty already assessed on the earlier year.
The situation — A residential cleaning franchise, Mississauga, Ontario
A residential cleaning franchise in Mississauga, Ontario was selected for review. Input tax credits claimed on receipts that had already been claimed once had shown up in the CRA's automated matching. The proposed adjustment on accounting records cleanup came to $74,000.
What we did for A residential cleaning franchise, Mississauga, Ontario
We set up a documented chart of accounts, a receipt-capture workflow and a monthly reconciliation that closes within ten days of month-end. Every figure in the response traced to a source record the auditor could verify without asking a second question.
The result — A residential cleaning franchise, Mississauga, Ontario
The review closed with no change. $74,000 of proposed tax came off the table, and the documentation now in place makes the next review a short one.
Case Study 6 · Objection and relief
Desk-Review Assessment Of $106,000 Vacated — Wedding Photography Studio, Red Deer
Client: A wedding photography studio · Where: Red Deer, Alberta · Engagement: 3 weeks, fixed fee
Assessment vacated$106,000
Supporting recordsNow on file
AccountCleared
The situation — A wedding photography studio, Red Deer, Alberta
A wedding photography studio in Red Deer, Alberta was carrying $106,000 of penalties and interest. The charges arose from a receivables list that included invoices collected eleven months earlier. Much of that amount accumulated during a period the CRA itself had delayed.
What we did for A wedding photography studio, Red Deer, Alberta
We converted the foreign-currency purchases at transaction-date rates and recorded the exchange difference at settlement instead of burying it in cost of sales. We framed the relief application on the specific grounds the CRA guidelines recognise rather than on general hardship.
The result — A wedding photography studio, Red Deer, Alberta
The assessment was vacated. $106,000 came off the account, and the documentation now on file makes the same position straightforward to defend next time.
Reviewed by Udit Gupta, Founder and Tax Accountant for the 2025 tax year. These case studies are illustrative worked examples composed from the CRA rules that apply to this type of work, not specific client files; figures are representative and outcomes depend on your own facts.
