Producing T2 for a client who completed their own bookkeeping.
Tax preparation-only engagement (not compilation) with some assistance cleaning their books.
I did suggest some corrections (cleanup) in the bookkeeping. Sent emails to the client telling them what corrections to make to the books, which they did.
I had to correct two/three transactions myself.
I logged into QBO to get all the #s.
I’m not connected to the corporation.
Which boxes would I check in Schedule 141 (Part 1 and 2)?
Box 111 - can you identify the person who did the work? Who was it - the client or his bookkeeper? Do you know? Yes or no.
Box 097 - you should be able to answer based on the information preceded by the two stars above.
Section 2 would be box 303.
Read the footnotes in that box. Then make your own judgement as to whether there is a single person more than 50% “involved” with the financial information. This is still fairly new - less than a year (I think?) - so we don’t know whether there are any consequences to answering it incorrectly. One could assume it helps CRA decide WHO to PHONE when they have questions about the GIFI information.
Part 2:
Ditto @johanus & @obhorst
But, alternatively, you could choose box 305, and specify that you merely filled out and filed the T2 - it IS possible to file a T2 without providing accounting services (though not likely if you ARE an accountant…)
Neither - the CRA (idiots) that designed this form don’t know the difference between an accountant and a bookkeeper and a tax preparer…and they don’t care.
You have to look at it from their perspective - they want to know who is responsible for these numbers that you have entered into S100 and S125. Some business owners have no involvement with the books, records, and financial transactions. Particularly in large corporations - there may be a whole accounting department that does the day to day accounting, and prepares quarterly financials; then they hand that off to an accounting firm to audit the annual financials; then they hire another accounting firm to file the T2. Who should CRA contact about the income and expenses? Maybe the controller?
On the other hand, if it’s a small business owner, and they hire you to do all their bookkeeping and tax filing, YOU are probably the one that CRA should contact.
If a small business owner makes financial decisions and executes transactions, then gets a bookkeeper to record them, and hires you to file the T2, and you create some journal entries, etc - there are 3 people who have SOME involvement with the financial information. It is likely that none of the 3 have more than 50% involvement.
If you can’t identify “that person” then you can’t answer whether “that person” has a professional designation.
Per your post, you have the business owner’s opinion of the “person primarily involved with the financial information”.
If you’re going to report that to CRA, I suggest you get consent from that bookkeeper. He/she may not agree that his/her involvement was more than 50%.
Or, make it clear to your client (the business owner) that you are reporting based on his/her statement (which might be included in the representation letter you get the client to sign). As such, if CRA holds the bookkeeper responsible for the GIFI numbers, and blames you for stating that on the S141, you can legally redirect their ire to the business owner.
