As a Professional Tax Preparer, I am often privy to audit trends that might impact both corporate and individual taxpayers.

For example, when the CRA/RQ implements a new audit program, I make sure that affected clients are advised and take measures to ensure if they are audited they are not caught by surprise.

Today as the personal tax season is almost underway, I would like to advise all interested parties of where RQ is focusing its attention:

Interest and financial expenses.

Pursuant to Article /157 of La Loi sur les impôts (RLRQ c.I-3) the following expenses are ordinarily NOT deductible:

1- Commissions paid to a broker (included in cost basis)
2- Tailing commissions or MERs
3- Loan interest for non-taxable accounts (TFSA, RRSP, RRIF, Segregated funds etc)
4- Fees paid on non-taxable accounts
5- Safety deposit boxes etc.

I’ve attached a link to RQ’s website which shows a full list of allowed and disallowed expenses.

I strongly recommend that taxpayers pay attention to this as excessive claims of these expenses may lead to an income tax audit.

If you want to learn more, reach out to us.