We have blawged about tax lawyers vs. accountants in the past (See Blawg), focusing on the fact that, the biggest distinction between tax lawyers and accountants is solicitor-client privilege. Accountants do not have privilege; they have been trying to get something like privilege for tax purposes for years, and the Supreme Court of Canada keeps denying them. So although the accountant-client relationship may be confidential in nature, accountants can be compelled to disclose everything they know by the Canada Revenue Agency (CRA).”
Recently, the CRA raided the Halifax branch of Grant Thornton, an accounting firm. According to the Financial Post, the CRA acted on the basis of a search warrant allowing the agency to seize the records relating to allegations that a client had committed offences under the Income Tax Act. Had this office been a law office, no warrant or raid would have been possible. As indicated in this article, recent case law has strengthened solicitor-client privilege, with the Supreme Court of Canada giving it quasi-constitutional status.
In practice, for most law-abiding people, this does not mean very much. But even if you think you are on-side of the law, if the CRA can see what advice you have been given or positions you have discussed or taken can have very adverse results. The Income Tax Act is several thousand pages, and very often it is unclear how to interpret many of the provisions and/or all of the provisions taken as a whole given a specific set of facts. A lot of disputes arise over what the law actually says vs. what the CRA thinks it says. So keeping advice, and the strategy and positions taken as a result, is important to everyone with a disagreement with the CRA.
This article is not intended as legal or tax advice and should be considered to be provided on a “For-your-information” basis only.
 See Canada (Attorney General) v. Chambre des notaires du Québec, 2016 SCC 20, Canada (National Revenue) v. Thompson, 2016 SCC 21, and Alberta (Information and Privacy Commissioner) v. University of Calgary, 2016 SCC 53