Sole Proprietors likely targeted by CRA this year.

The CRA has started a letter campaign asking selected taxpayers to self assess certain deductions they may have claimed on their tax returns. CRA says the campaign is to educate taxpayers and promote compliance with the Income Tax Act.

If you receive a letter, it will include information on Business Activities … explaining the eligibility, rules and regulations of some of the business activity expenses CRA would look at if and/or when they audit you.

It reviews:

– record keeping requirements,

– the start date of your business,

– capital, current and personal expenses,

– meals and entertainment,

– office expenses,

– salary and wages,

– subcontractor payments documentation and determination,

– motor vehicle expenses including the simplified logbook,

– business-use-of-home expenses

 

Dianne Mueller CPB

Soma Small Business Solutions