SRED Audit Defense

Whether it’s to provide feedback or to defend your claim, EVAMAX is here to support our clients through the CRA audit.

What you need to know & how an experienced team at EVAMAX can help

So, you have been claiming SR&ED tax credits for a while and are now faced with a CRA review/audit.

SR&ED Claim Reviews are essential for compliance to ensure the efficiency of the tax system. These reviews often cause moments of frustration and panic. Every Canadian taxpayer gets audited every 3-5 years, so you shouldn’t worry! While many SR&ED claimants can go unaudited for longer than that period, it is fair to expect an audit at some point. It is crucial the taxpayer is prepared and equipped with sufficient resources to successfully go through an audit.

1

Being selected for any kind of audit by CRA does not indicate that the taxpayer is suspected of any wrongdoings. It’s just a due diligence procedure on CRA’s side.

2

Are you a first-time claimant? Most receive a First-Time Claimant Advisory Service (FTCAS). Meaning the claim may be accepted as filed (AAF). During this review, it is important to demonstrate compliance. We support our clients through these common procedures, while our team of experts ensure clients are extensively prepared for this meeting.

3

If you are an existing claimant and it has been a while since the CRA has touched base with you regarding the SR&ED program, you may receive a Claimant Advisory Service (CAS) which is similar in nature to an FTCAS.

4

To begin an audit, the CRA Audits issues the initial request for information (RFI). In most cases, if they receive timely, accurate responses and their inquiries are addressed appropriately, it will result in a completed audit. However, if the CRA auditors request an on-site meeting or issue the subsequent RFIs, there’s no need to worry. We will support you, by attending your meetings with CRA and fully representing your audit defense.

5

If you have been audited and your claim has been declined by the CRA, you are not prohibited from applying. If all relevant expenditures in fact did occur within the current Fiscal Year and other Fiscal Years under review, and in your opinion SR&ED activities took place, it is worth making an application.

Often, claims are rejected if enough information is not provided, or the provided information is not presented accurately to convey the claimant’s position, or information is not submitted in a timely manner. There are occasions where there is a difference of opinion between the CRA and the claimants.

How does the Team at EVAMAX Group support clients through the CRA audit? What do we do differently?

We help clients in different scenarios:

If the claim is not submitted by us and we are hired to defend a client during audit, we work with prior information submitted to the CRA by the taxpayer or their representative. Using this information, we build a strong eligibility case. In some exclusive circumstances, we can re-build and re-submit the claim if time permits. This depends on the timeline arranged between the claimant and CRA.
We will listen to your thoughts and concerns and will share our insight on the best way to proceed.
The first step is to open communication channels with the CRA.
We identify gaps and omissions in the original submission and will collaborate with you to gather, re-structure and prepare responses and generate the additional information required and to provide CRA with the necessary documentation to fully match it with eligibility requirements.
There are many reasons when the audit outcome is not as expected by the claimant. We not only handle the submissions of information, but we use the several recourses available to defend the SR&ED Claim. For example, requesting additional reviews, filing objects or appeals.
Each case is different and it’s imperative to have an experienced consultant supporting you through the process.

Our Goal: Our team at EVAMAX is fully committed to
provide services which are fully compliant, both technically
and financially, with the current CRA requirements, for our
valuable clients, taxpayers.

We provide you with up-to-date recommendations on how
to better plan and present your work in the SR&ED claim
for each fiscal year.

Our focus is delivering long-term financial success with our
clients while maintaining a strong relationship with CRA.

If you are facing a SRED Audit and need a second opinion
OR
want to discuss engaging EVAMAX to help with your Audit defense.