The Tax Audit Part 3 - Dos and Don’ts for Initial Meeting

The most important thing that can be said for this stage of the audit is do not volunteer information.  I will say it again so there is no confusion.  DO NOT VOLUNTEER ANY INFORMATION.   Answer the auditor’s questions as best you can and nothing else.  If you don’t know or are not 100% sure of the answer then tell the auditor that you don’t recall, and that you will get them an answer.  While I believe honesty is the best policy, it is not lying if they don’t ask.  Answer the questions asked but nothing more.
The second most important thing you need to know is that if you are bringing your documents to the meeting do not bring originals.  This is also extremely important so I will say it again.  DO NOT GIVE THE CRA YOUR ORIGINAL DOCUMENTS!!!  Give them photocopies.  Contrary to what they may say photocopies are totally acceptable.  CRA has lost documents in the past.  If they can’t find them then you may be out of luck even though it is their fault.  In addition, make sure you get a receipt for the documents you do provide so that they can’t say that you did not give them the information that was requested. 
On the topic of documents make sure you remove all personal documents that are not claimed on your tax return.  Auditors have been known to review documents and assume that if they are “in the box” then they are on the tax return.  So get rid of the speeding tickets, trip to Florida or Hawaii, and the receipts for the kid’s electronics.  Put them somewhere else other than in your business records.
Don’t be late.  In fact, be early.  Nothing makes for a bad meeting like being rushed and running late.  You want to be early so you can discuss things with your representative, spouse or partner.  Bring a drink, hit the bathroom, and focus on the task at hand.  Your task is to show the auditor that you have nothing to hide, and that you did everything correctly and according to the tax laws.
Do not go alone.  The situation is stressful enough as it is without feeling like you are starting off at a disadvantage.  Moral support can make all the difference between success and failure as well as providing you with a second set of eyes and ears.  I still recommend that you take a professional with you as the fees you pay will far outweigh the potential problems CRA can create for you.
Bring an authorization form (T-1013 - Personal Tax Consent form available on the CRA website, and or a RC-59 Business Consent Form for Corporations) for whoever comes with you.  You are allowed to bring anyone you want to the meeting (don’t let CRA tell you otherwise).  The CRA can force you to provide written authorization for anyone attending the meeting with you, so be ready and don’t get caught off guard.