A business had two years of unreconciled books. We rebuilt and reconciled everything, ready to file, in weeks.
A business with two years of neglected books faced overdue filings and no reliable numbers. We rebuilt the ledger from bank feeds and source documents, reconciled every account, and produced clean statements. The company filed its overdue returns and gained accurate monthly reporting going forward.
The CRA requires business records to be kept for six years from the end of the tax year they relate to, in a form that allows the return to be verified.
Why it bites: Where records cannot support the return, the CRA is entitled to assess on its own estimate — and the burden of disproving that estimate falls on the taxpayer.
The late-filing penalty is 5% of the balance owing plus 1% for each full month late, to a maximum of twelve months. A second late filing within three years doubles both figures.
Why it bites: The penalty is calculated on the balance owing, so a late return with nothing owing costs nothing — which is why filing on time matters even when you cannot pay.
A small corporation still carries the full compliance set: T2, GST/HST, payroll, and the annual return with the incorporating jurisdiction.
Why it bites: The annual corporate return is separate from the T2 and is the one most often forgotten, which can lead to administrative dissolution.
Every engagement above was priced as a fixed fee agreed before the work started, and paid only once the client had reviewed the result. If any of this looks like your situation, the first step is a free 15-minute call — we will tell you plainly whether there is anything worth doing.
Reviewed by Udit Gupta, Founder and Tax Accountant for the 2025 tax year. This case study is based on a real client engagement handled by Tax Filings Canada; the client's name and identifying details have been changed. Outcomes depend on your own facts.
Sources. CRA — Keeping records · CRA — Businesses · Income Tax Act (Justice Laws Website)
