The Canada Revenue Agency (CRA) doesn't always get it right. If you're a small business owner who has received a Notice of Reassessment stating that you owe a significant amount of tax, interest and penalties, that's the first thing to remember, says Peter V. Aprile.
Writing in The Globe and Mail, he offers eight pieces of advice for small business owners caught in this situation. Two that I found most interesting;
1) The CRA is not interested in making deals.
"...the CRA will not agree to settle a dispute unless persuaded that the taxpayer's position is correct in fact and/or law," writes Mr. Aprile. So trying to get a "knockdown" on the amount owed by whatever bargaining techniques have worked for you in business deals is a waste of time.
2) Save the begging for last and then only if you have to.
Mr. Aprile says that taxpayers with tax bills on their assessments often just ask the CRA to waive or cancel interest and penalties under the taxpayer relief provisions rather than challenging the merits of the assessment. This, he says, "is the tax equivalent to approaching the Minister of National Revenue on bended knee... In most cases, if a taxpayer has an arguable case the better route is to dispute the reassessment".
My main takeaway from this article, though is that dealing with the Canada Revenue Agency about a tax dispute is not a suitable do-it-yourself project. Sometimes you need to spend money to protect money. Connecting with a tax lawyer with tax dispute resolution experience would be the best first step.
For any questions, please contact me.
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