Canadian tax authorities continue to aggressively pursue taxpayer information, using the extensive powers granted to them under tax legislation. Sensitive communications with, and work product prepared by, accountants and other non-lawyers represent fertile ground for the Canada Revenue Agency. This was illustrated by the CRA’s success before the Federal Court of Canada in Minister of National Revenue v. BP Canada Energy Company, in June 2015, in forcing disclosure of the taxpayer’s list of uncertain tax positions prepared for financial statement purposes, for use as an “audit roadmap.” Governments’ need for tax revenues and the global trend towards greater tax transparency will only make revenue authorities more aggressive in seeking confidential information. Lawyer-client privilege constitutes the one defence to information demands that Canadian courts have consistently upheld, and well-advised taxpayers will ensure that tax-sensitive communications and work product are prepared on a privileged basis to the greatest extent possible.

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