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Restaurant Audits: What Owners Needs to Know

Restaurant Audits: What Owners Needs to Know

 

Restaurant Audits: What Every Restaurant Owner Needs to Know

Source: Hazlo Law
Authors: Dean Blachford, Karen Cheung

If you own a restaurant, the CRA has its eyes on you. Auditors frequently investigate restaurants for potential unreported income and HST/GST. Often, the outcome is bad for restaurant owners.

According to the results of an access to information request conducted by HazloLaw – Business Lawyers, restaurants that are subject to an audit have a 60% chance of being reassessed for additional income tax and a 76% chance for additional HST/GST. These reassessments include an average of $17,580 in gross negligence penalties. In extreme circumstances, the CRA reassesses the restaurant owners as well. In these cases, the combined amount owing for the restaurant and its owners can reach over $500,000, even for a small restaurant.

This article explains the CRA’s most common techniques for auditing a restaurant so that owners know what to expect and can make informed decisions on what actions to take.

Click here to read the full article.

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