What is the GHW audit program?
The GHW audit program forms part of CRA’s efforts to target non-compliance among the very wealthy to ensure fairness and transparency in the tax system. As this demographic will usually have access to sophisticated financial and legal advice, a key aspect of the GHW program is its emphasis on auditing entire groups of entities rather than focusing exclusively on individual taxpayers. The comprehensive audit approach acknowledges the complexity and interdependence within high-net-worth groups and aims to address sophisticated tax planning strategies that involve multiple legal entities and may cross international borders. This type of audit is complex, is undertaken by a team of experienced CRA auditors, and can take years to complete.
What can taxpayers expect from the audit process?
Individuals subject to a GHW audit can expect an initial letter from the CRA informing them that they have been selected for an examination. In addition to having their personal income tax returns for the selected taxation years audited, the income tax returns of entities they are related to or have an economic relationship will also be examined. This initial letter will request an organization chart that shows all entities that you or a member of your family, either alone or together with related parties, controlled directly or indirectly during the years under audit. These entities include non-resident entities. An organization chart will also be requested for entities in which you or a member of your family was beneficially interested, for example, as a beneficiary of a trust. In addition, the letter will request details of all reorganizations or restructuring undertaken during the years under audit.
Following this initial request, you can expect a more detailed request letter listing the names and fiscal periods of all the entities under audit. The letter will also request detailed financial statements, corporate record books, tax planning documents, details of significant transactions, financial statements of joint ventures and partnerships, and other relevant documents for each entity under scrutiny.
As these numerous audits progress, there can be additional requests for information. At times, it may not be clear what specific information the CRA auditors are looking for, leading to frequent back-and-forth communications.
How should taxpayers prepare and approach the audit process?
Taxpayers should seek professional advice immediately upon notification of an audit. BDO tax advisors can serve as a liaison in communications with the CRA, help clarify queries, and ensure that responses are carefully crafted and documented. In addition, for complex matters, it’s important to engage legal counsel to ensure solicitor-client privilege is preserved and sensitive information is appropriately protected. These audits are often a lengthy process, and associated costs can be substantial.
It is critically important to respond to CRA requests in a timely and collaborative manner. The CRA has broad powers to compel information from taxpayers and third parties, such as financial institutions, during an audit. Providing the information requested directly allows you more control over what is provided. Be mindful that being perceived as uncooperative with the CRA may lead to misunderstandings and a more drawn-out audit process.
However, the first step starts before you or your company is approached by the CRA for an audit. Be proactive and work with your BDO tax advisor to ensure that your tax compliance is up-to-date, corporate records are well documented, and minute books are maintained. Keep in mind that this applies to taxpayers regardless of current audit status, and it can help reduce costs and minimize disruption should you be subject to an audit from the CRA in the future.
How BDO can help
High-net-worth taxpayers subject to CRA audits face a highly detailed, resource-intensive process. The most effective strategy is to engage trusted advisors, cooperate fully, and maintain thorough documentation. With preparation and professional support, navigating the audit can be less daunting and more manageable. Your BDO tax advisor is ready to help.
The information in this publication is current as of Sept. 10, 2025.
This publication has been carefully prepared, but it has been written in general terms and should be seen as broad guidance only. The publication cannot be relied upon to cover specific situations and you should not act, or refrain from acting, upon the information contained therein without obtaining specific professional advice. Please contact BDO Canada LLP to discuss these matters in the context of your particular circumstances. BDO Canada LLP, its partners, employees and agents do not accept or assume any liability or duty of care for any loss arising from any action taken or not taken by anyone in reliance on the information in this publication or for any decision based on it.