CRA’s Related Party Initiative

Part I
CRA’s Related Party Initiative
CRA’s Related Party Initiative
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The Canada Revenue Agency (“CRA”) is launching a new project named the Related Parties Initiative (“RPI”) aimed at wealthy individuals and related entities. The CRA intends to initiate the RPI audits sending a 22 page questionnaire to taxpayers that the CRA has selected for audit.

We recommend that taxpayers who have failed to report taxable income retain legal counsel and initiate a voluntary disclosure as soon as possible. In addition, we recommend that taxpayers who receive the RPI questionnaire retain legal counsel to assist them in providing the CRA with appropriate answers to proper CRA requests for information. Last, we recommend that taxpayers dispute any improper CRA reassessment.

Insights

Leveraged growth leads to CRA reassessments and disputes. This insight explains how exposure modelling, objection strategy, and dispute readiness affect a company’s ability to reduce or overturn a reassessment.

Counter Sphere 1 Image, with “CRA Reassessments Behave Like Capital Events” title text, Counter Tax Litigators LLP: strategic leadership in complex CRA disputes.

CRA’s audit architecture drives reassessments that behave like capital market shocks inside private companies. This article examines the structural forces at play and how executives maintain control once CRA formalizes its position.