Legal Document When Doing Corporation Tax Return

Anyone can share a template or letter they use when filing corporation tax returns to basically say the client will not hold the accountant responsible and that the client has backup to all numbers and has the receipts and can provide to CRA and will not hold liable the accountant etc etc etc

I don’t think you can get out of your responsibility that easily. If you, as the accountant, make a mistake, the client and/or CRA could hold you liable/responsible regardless of any such letter signed by the client.

Further, if you file a tax return of any kind on behalf of a client (particularly under EFILE), you are attesting that it is not based on false or fraudulent information. That is (one of the reasons) why most of us accountants will not file a T2 without preparing a whole “year-end file” with supporting documents.

Typically this kind of liability is addressed by using standard engagement letters and representation letters determined by whatever professional accounting association you are a member of (CPA, RPA, PBA, ATAP, CPB, etc), as well as by keeping your E&O insurance up to date.

Personally, I wouldn’t do corporate taxes without having all the legal protections in place. Too risky. In fact, I wouldn’t recommend doing T1s or any other tax filing without some of the same protections (years ago I used to file T1s for clients using Netfile, without having any such protections, but I didn’t know better at the time…now I do).


This is the correct answer!

It’s not more of errors or mistakes it’s more of the client withholds information from me or tell me the wrong information or provides wrong documents of missing information

Your Professional Association should have a format for you to use. These are proprietary documents that are not shared outside the PA and are copyrighted by each Association.

If this is the case, perhaps you should refuse to provide services to that client - they will likely get you into trouble.

If you know or suspect the information/documentation is wrong, you need to talk to the client and obtain the RIGHT information. Filing a tax return when you KNOW the information is incorrect is against the law.

This is the only situation you can legitimately defend (if you never knew about it, you can’t be held responsible for it). This is what is generally addressed in the engagement letter and/or representation letter (ask your accounting association).

1 Like

Google corporate tax engagement letter for an idea and have a lawyer review your final draft before use. This is a legal document that should not be taken lightly.

Also, don’t take on ANY clients that you suspect will be dishonest or do things the wrong way. You don’t want to be associated to that.