The Canada Revenue Agency (CRA) has sent you this letter to give you information about certain claims you made on one or more of your recent income tax and benefit returns. This letter also gives you the opportunity to ask for an adjustment if you find that you incorrectly claimed some items on past tax returns.

The information in this letter will make it easier for you to comply with Canada's tax laws. It will help you to check your most recent tax returns to make sure they were correct when they were filed. The information will also be useful to you when you get ready to file your 2016 income tax and benefit return.

The CRA wants to give you the opportunity to request an adjustment if you find that items were incorrectly claimed in any of the past tax returns you filed. If the claims you made on your income tax and benefit returns were accurate, no further action is required.

For more information, see Request for adjustment and Voluntary Disclosure Program (VDP).

Possibility of audit

Receiving this letter does not necessarily mean that you will be selected for an audit. We consider a number of risk factors before conducting audits.

We rely on risk-assessment systems and research to determine which taxpayers are most likely to misunderstand their tax obligations. We also randomly select tax returns and conduct reviews to verify that taxpayers are paying their taxes in full and on time. If our review indicates that certain activities are more at risk for non-compliance than others, we may conduct more audits of taxpayers reporting these types of activities.

If an audit is required

Even if we decide to conduct an audit, we will not start any audit until at least 45 days after the date of this letter. This gives you an opportunity to review your returns using the information included in this letter and to ask us to adjust your return.

Under the Income Tax Act, we can adjust tax returns:

1. during the three years following the date on their respective notice of assessment.
   
   For example, if your 2014 tax return was filed on April 15, 2015, and your 2014 notice of assessment is dated May 28, 2015, the CRA can reassess your 2014 tax return until May 28, 2018 (May 28, 2015 + three years).
   
2. for any years that the taxpayer or person filing the return has made any misrepresentation that is attributable to neglect, carelessness, or willful default or the taxpayer has committed any fraud in filing a return, or supplying information under the Income Tax Act.

Forms and publications

• Guide T4002, Business and Professional Income
• Guide T4036, Rental Income
• Guide T4037, Capital Gains
• Guide T4044, Employment Expenses
• Guide RC4110, Employee or Self-Employed?
• Form T1-ADJ, T1 Adjustment Request
• Form T776, Statement of Real Estate Rentals
• Form T777, Statement of Employment Expenses
• Form T2125, Statement of Business or Professional Activities
• Form T2200, Declaration of Conditions of Employment
• Form RC199, Voluntary Disclosures Program (VDP) - Taxpayer Agreement
• Income Tax Folio, S3-F4-C1, General Discussion of Capital Cost Allowance
• Income Tax Folio, S4-F2-C2, Business Use of Home Expenses
• Interpretation Bulletin IT195R, Rental Property - Capital Cost Allowance Restrictions
• Interpretation Bulletin IT364, Commencement of business operations
• Interpretation Bulletin IT352R, Employee's Expenses, Including Work Space in Home Expenses
• Interpretation Bulletin IT518R, Food, Beverages and Entertainment Expenses
• Interpretation Bulletin IT522R, Vehicle, Travel and Sales Expenses of Employees
• Information Circular IC00-1R5, Voluntary Disclosures Program

Related Topics

• Documenting the use of a vehicle
• My Account for Individuals
• Voluntary Disclosures Program
• My Payment - save time, pay online!
• Keeping Records