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WHEN DO I NEED A TAX OR TRADE LAWYER?

RETAINING A LAWYER AT AUDIT OR ASSESSMENT A WISE DECISION!

In my 35+ years of experience, I have seen the tax world evolve quite a bit.  It used to be that tax or trade lawyers were engaged very early on in most disputes.  Usually at the time of audit.  Overtime, we have seen clients try different approaches, from beginning to use non-lawyer accountants or customs brokers for dispute resolution, to (most recently) relying on AI to fight the dispute for them.

Four Reasons to Retain Experienced Counsel Early

This Report focuses on 4 reasons why engaging a tax and trade lawyer EARLY on in a dispute (preferably at the time of Audit, and no later than the time of the Assessment) makes better sense for taxpayers and importers interested in a successful conclusion to their battle with the government.

1. Lawyers are Trained to be Advocates

Nothing against my friends at accounting firms or customs brokerage houses, but I spent a good part of my law school, and the better part of the last 35+ years being specifically trained in how to advocate and represent a client in a legal dispute (which is exactly what a tax or customs assessment is and exactly what a tax audit or customs verification portends!).  You will NOT generally find an accountant or a customs broker with that same level of training.

2. Lawyers are Trained to Find the Correct Legal Answer

Again, nothing against my accountant and customs brokerage colleagues, but they have NOT been trained at law school to understand legal issues, find the correct legal advice and provide that legal advice – NOR are any of them licensed to provide legal advice!  (One needs to be a duly licensed and dues paying lawyer to do that!!).

3. Top Advice Only from the Top Specialists

In the tax and trade area, you generally get what you pay for, and specialist legal advice can only be provided by a lawyer.  Think about that in these terms: if you are fighting a health issue that threatens your life, do you want the top surgeon in her field on your file, or would you settle for one without a medical degree?

4. Lawyers alone can Provide Solicitor-Client Privilege

Last, but perhaps most importantly, only dues paying lawyers are permitted to provide what is called “Privileged & Confidential” advice.  That is, advice that can be kept private from the Canada Revenue Agency (“CRA”), the Canada Border Services Agency (“CBSA”), any branch of the Police, and even the Courts!   Advice provided by an accounting firm or customs brokerage is NOT Privileged & Confidential, and if asked for by the CRA, CBSA, a Police Officer or the Courts, is generally going to have to be disclosed!   One can imagine the value, in this context, of legal advice over accounting or brokerage advice!

Takeaway

There are several reasons why retaining an experienced tax and trade lawyer at the time of an audit or assessment makes sense, each going back to the specialized training that a lawyer receives in law school and over their many years of legal practice.  Because of this, only dues paying lawyers are permitted to provide the legal advice necessary to fully understand and defend tax and trade assessments, and only their advice qualifies for “Solicitor-Client Privilege”.

For help with Tax and/or Trade disputes, click here.

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