6 Prior-Year Payroll Correction tax and accounting engagements in full — what the client came to us with, what we did, and what it was worth. Each one is specific to prior-year payroll correction work, not a general example.
Case Study 1 · Scaling without breaking
Second-Province Expansion Handled, $71,000 Of Cash Released — Growing Tech Team, Moncton
Client: A growing tech team with stock options · Where: Moncton, New Brunswick · Engagement: 6 weeks, fixed fee
Cash released$71,000
New registrationsComplete on day one
Compliance gapsNone
The situation
Revenue at a growing tech team with stock options in Moncton, New Brunswick was up sharply and cash was tighter than ever. Underneath it sat long-term contractors who met every test for employment.
What we did
We reviewed each contractor against the CRA’s control and integration tests, converted those who met the employment tests, and priced the transition before it was forced by a ruling. Every new obligation — registration, remittance frequency, provincial filing — was set up before it was triggered, not after.
The result
$71,000 of cash was released from the working capital cycle, and the expansion completed with every registration and filing obligation covered from day one.
Case Study 2 · Backlog brought current
3 Years Filed, $16,000 Removed From The Assessed Balance — 30-Employee Manufacturer, Brampton
A 30-employee manufacturer in Brampton, Ontario had not filed for 3 years. The CRA had issued arbitrary assessments, and the business was carrying T4s that did not agree to the payroll register or the general ledger on top of a growing interest balance.
What we did
We started with the oldest year and worked forward so each year's closing balances fed the next. We reconciled the payroll register, general ledger and T4 summary to the cent, then filed the amended slips, filing the years in sequence rather than all at once.
The result
Every year is now filed and assessed on actual figures. The notional assessments were vacated and $16,000 of the estimated balance came off, with a payment arrangement covering the rest.
Case Study 3 · Records and systems rebuilt
Books Rebuilt From Source, $14,500 In Unclaimed Input Tax Found — Security Services Contractor, Hamilton
A security services contractor in Hamilton, Ontario could not answer basic questions about its own numbers, because remittances still going out monthly after the business had moved to the accelerated threshold sat between the bank statements and the ledger.
What we did
We reconstructed vehicle logbooks, calculated the standby charge and operating benefit properly, and amended the affected T4s, then documented the process so the work does not depend on any one person remembering how it was done.
The result
Records rebuilt and reconciled, $14,500 recovered in input tax credits that the old file could not support, and a documented monthly process now in place.
Case Study 4 · CRA review defended
$39,000 Proposed Adjustment Withdrawn In Full — Restaurant with Heavy Seasonal, Calgary
Client: A restaurant with heavy seasonal turnover · Where: Calgary, Alberta · Engagement: 10 weeks, fixed fee
Adjustment withdrawn$39,000
File closed in10 weeks
Penalties assessedNone
The situation
A restaurant with heavy seasonal turnover in Calgary, Alberta received a proposal letter opening a review of prior-year payroll correction. The CRA had identified company vehicles used personally with no logbook and no taxable benefit reported and proposed an adjustment of $39,000, with 30 days to respond.
What we did
We treated the response as an evidence exercise rather than an argument. We moved the account to the correct remitter frequency, caught up the arrears, and filed a taxpayer relief request that cancelled the bulk of the penalty, then indexed every supporting document against the specific line the auditor had questioned.
The result
The proposed adjustment was withdrawn in full — all $39,000 of it. The file closed in 10 weeks with no change to the assessed amounts and no penalty.
Case Study 5 · Structure rebuilt
Reorganisation Completed Tax-Deferred, $73,000 Saved Each Year — Landscaping Company with Seasonal, Barrie
Client: A landscaping company with seasonal staff · Where: Barrie, Ontario · Engagement: 11 weeks, fixed fee
Annual saving$73,000
Tax on reorganisationDeferred
Elections filedOn time
The situation
A landscaping company with seasonal staff in Barrie, Ontario had outgrown the structure it started with. A director facing a personal assessment for unremitted source deductions was the immediate problem; the longer-term one was that the structure blocked the next step.
What we did
We mapped the current structure, modelled the target, and reviewed each contractor against the CRA’s control and integration tests, converted those who met the employment tests, and priced the transition before it was forced by a ruling — with the tax-deferred elections filed on time and the supporting valuations documented.
The result
The reorganisation completed without triggering tax, and the new structure saves approximately $73,000 a year while removing the exposure the old one carried.
Case Study 6 · Cash and remittance control
$114,000 Of Working Capital Freed From The Tax Cycle — Home-Care Agency, Regina
A home-care agency in Regina, Saskatchewan was profitable on paper and short of cash every month. Long-term contractors who met every test for employment explained most of the gap.
What we did
We reconciled the payroll register, general ledger and T4 summary to the cent, then filed the amended slips and built a thirteen-week cash view so tax payments stopped competing with payroll for the same dollars.
The result
$114,000 was released back into working capital. Remittances have been on time every period since, and the forecast shows the tax outflow before it lands.
Reviewed for the 2025 tax year by Udit Gupta, Certified Tax Accountant. Figures describe representative engagements of this type; outcomes depend on your own facts. Client names and identifying details are omitted for confidentiality.
