Regardless of how meticulous we are with our paperwork and honest we are with the Government, every individual Canadian dreads the thought of an”audit”. But what are your chances of actually being audited? Well, according to the CRA, during the 2008-2009 fiscal year, 87,000 T1 returns were subject to a post assessment targeted review. This resulted in 31% of them being adjusted. 89,000 T1 returns were subject to a random review, resulting in 17% being adjusted.
According to The Canada Revenue Agency (CRA), they review a number of returns to ensure that they were filed correctly. A small percentage of Canadian tax returns are selected for review before they are assessed. These are flagged by the CRA`s computer system because they display characteristics indicationg a higher possibility of non–compliance. This could be because of the size of the refund, the type of deduction or credit claimed, or the taxpayers compliance history. Some returns are also selected at random.
According to CRA, the chances of being selected for review are the same whether you paper file or electronically file your return.
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