Case Study: Navigating a $98K Payroll-Tax Dispute for a Tech Firm
Client Profile:
- Industry: Technology services
- Location: Ontario, Canada
- Annual Revenue: Under $1M
What Prompted Us to Review
The CRA demanded unpaid payroll taxes after shareholder loan advances were misclassified as salary.
What We Found
Approximately $98,000 of genuine loan advances had been reported as employment income, triggering CPP, EI, and withholding liabilities.
Recovery & Impact
- Dispute Amount: Successful in dispute and client was not required to pay the respective liability to CRA
- Liquidity Preserved: Collection action suspended
- Client Relief: Strong documentation positioned them for penalty relief
Key Takeaway
Clear documentation and correct classification of shareholder transactions are essential to avoid costly payroll-tax disputes.
CASE STUDY: Unlocking a $10K+ Tax Refund via Loss Carryback
Learn about how how an HVAC company received over $10,000 in via tax refund.
