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ARTICLE · 17 APRIL 2023

The CRA's Approach To Accommodation Invoice Tax Schemes

Counter Tax Litigators LLP
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The general trend is that Canada Revenue Agency is disallowing more input tax credits ("ITCs") for businesses.

CanadaTax
Jennifer Mak
Jennifer Mak
James Roberts
James Roberts
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The general trend is that Canada Revenue Agency is disallowing more input tax credits ("ITCs") for businesses. In addition, the CRA has launched a project to uncover and disallow ITCs they believe relate to an accommodation invoice tax scheme.

The CRA is getting it wrong in some cases. We see some businesses are getting "caught up" in these schemes. And we see CRA disallowing valid ITCs.

After reading this article, you will know:

  1. how to reduce the risk you will fall prey to this scheme; and
  2. what to do if the CRA alleges your business engaged in this scheme.

How It Works

An accommodation invoice tax scheme occurs when a supplier issues an "accommodation invoice" to a purchasing business. Usually, the purchaser isn't aware.

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