Mistakes, Penalties and Official Sources
Switching accountants or disputing a bill: how to move your corporation's file cleanly
How a Canadian corporation changes accountants mid-year or at year end, what records to ask for, how to update CRA authorizations, and where to turn when a fee or service dispute cannot be settled.
You can change accountants at any time, but the cheapest moment is after one year end is finished and before the next one starts. To switch cleanly, get your accounting file, the final trial balance and adjusting entries, the filed returns and slips, and carryforward balances from the old firm; give the new firm a written engagement; and update CRA and Revenu Québec authorizations so the old firm no longer has access. If you are leaving because of a disputed bill or poor service, first ask for an itemized breakdown and talk to the partner; if that fails, provincial CPA regulators handle professional conduct complaints, and fee disputes may end up in small claims court or mediation.
This guide is part of the corporate accounting mistakes guide. It is general information, not legal advice.
Reasons owners switch, and whether switching fixes them
| Reason | Will a new firm fix it? | Check first |
|---|---|---|
| Fees keep rising | Maybe; if the cause is your records, the new firm will bill too | Ask for a task breakdown; compare with your fee estimate |
| Slow response or missed deadlines | Often | Whether you sent records late |
| Lack of industry or Quebec experience | Often | The new firm's experience |
| Wanting a cloud or automated workflow | Often | Whether the new firm works in your software |
| Corporation outgrew a sole practitioner | Often | Capacity for review or audit work |
| Disagreement about a tax position | Not necessarily | A second opinion may be enough |
What to request from your current accountant
- Accounting file or export of your general ledger, if the firm maintained it
- Final trial balance and the adjusting journal entries for the last year end
- Financial statements and the T2, provincial returns and slips as filed, with confirmation of filing
- Carryforward schedules: capital cost allowance (undepreciated capital cost by class), non-capital and capital losses, refundable tax and dividend account balances (RDTOH, GRIP), and the capital dividend account if applicable
- Shareholder loan reconciliation
- GST/HST and QST filing records and any correspondence
- Correspondence with the CRA and Revenu Québec, including open reviews
- Original documents you gave the firm
The firm's own working papers generally belong to the firm, but your original records and the information you need to file should be provided. Professional codes of conduct generally require members to respond to communications from a successor accountant; the new firm will usually contact the old one directly.
How to handle the timing
- Decide early. Tell the new firm before your year end so it can plan.
- Pay or settle undisputed fees. A clean handover is easier when undisputed amounts are paid.
- Give written notice to the old firm and ask for the items listed above by a specific date.
- Update authorizations. In the CRA's representative services, remove the old representative and authorize the new one. In Quebec, update the authorization with Revenu Québec too.
- Change software access. Remove the old firm's user and add the new one.
- Transfer open matters. If a CRA review is open, decide who will finish it.
Illustrative cost of switching
A new firm usually needs extra time in its first year to understand your corporation and confirm opening balances. Suppose an illustrative 4 extra hours at $150 = $600 in the first year. If the new firm's ongoing fee is $500 a year lower, the switch pays back in a little over a year: $600 / $500 = 1.2 years. If the old firm will not release carryforward schedules, rebuilding them could add many more hours.
Disputing a bill
- Ask for an itemized account showing tasks, dates, hours and rates.
- Compare it with the engagement letter: was the work in scope, and was approval required for extra work? See engagement letter scope and extra fees.
- Put your concerns in writing and propose a resolution.
- Meet with the partner or owner of the firm.
- Consider mediation. Some disputes settle faster with a neutral mediator.
- Small claims court. Fee disputes within the provincial small claims limit can be heard there; limits differ by province.
Professional conduct complaints
If the concern is about professional conduct, such as competence, confidentiality, conflicts of interest or a failure to respond, you can file a complaint with the provincial or territorial CPA regulator, for example CPA Ontario, CPA British Columbia, CPA Alberta or the Ordre des CPA du Québec. Regulators investigate conduct; they generally do not set fees or award damages. Some provincial bodies have specific processes for fee reviews or arbitration; check your regulator's site.
If the person is not a CPA, there may be no professional regulator; your options are the contract, consumer or small claims routes.
Problems with the CRA, not the accountant
If the dispute is about how the CRA handled your file, use the CRA's service feedback process and, if unresolved, the Office of the Taxpayers' Ombudsperson. Disagreements with an assessment go through a notice of objection. See CRA reviews and record retention.
Mistakes to avoid when switching
- Switching in the middle of busy season without records ready
- Leaving without carryforward balances
- Forgetting to remove the old firm's CRA and software access
- Giving the new firm a narrower scope without realizing what the old firm did, such as the Quebec annual updating declaration or T5 slips
- Withholding payment of undisputed fees in a way that delays your own filings
If the problem is penalties caused by late filing, see late-filing penalties for T2 and GST/HST, and for regulators' contact points see the directory of official sources.
Frequently asked questions
Can my old accountant refuse to give me my records?
Your original documents are yours. Rules about working papers and any right to hold documents for unpaid fees vary; if a firm refuses, ask the provincial CPA regulator and consider legal advice.
Will switching trigger a CRA review?
No. Changing representatives is routine.
Should I tell the new firm why I left?
Yes, briefly and honestly. It helps the new firm avoid the same problems.
Sources
- CPA Canada — links to provincial CPA regulators
- CPA Ontario — complaints and professional conduct in Ontario
- Ordre des CPA du Québec — complaints and professional conduct in Quebec
- Canada Revenue Agency — authorizing and removing representatives
- Office of the Taxpayers' Ombudsperson — service complaints about the CRA
