After a less than stellar experience trying to sell less product for the same price, Intuit is taking a new tack this year – it is offering a feature called Audit Defence that QuickTax users can optionally purchase (at a cost of $39.99 per return) when preparing their taxes. According to Intuit, QuickTax users who purchase Audit Defence can avail the help of an experienced tax professional who will deal with the CRA in the event a taxpayer is audited.
QuickTax users will be faced with two questions this year: (1) Should they consider buying Audit Defence? (2) Assuming a taxpayer likes the idea of not having to face CRA alone, can they obtain representation cheaper elsewhere?
The type of users who do their own taxes will typically have very simple tax situations – they have one or two T4s, some RRSP contributions, childcare expenses, charitable donations, dividend and interest income and perhaps a small home-based business – and presumably doesn’t involve a deep understanding of the tax code. In these cases, an “audit” is usually nothing more than the CRA checking to see if they actually have the receipts. For instance, recently my wife’s tax return was selected for review. CRA wanted to see receipts to support her claim for child care expenses, which is a relatively straightforward affair and in my opinion, doesn’t justify paying for expert representation.
Some taxpayers would still rather not face the CRA by themselves, which is understandable considering the awesome power the tax agency wields. They may want to check out the new kid in the block: H&R Block is now selling desktop and web-based tax software for the same price as QuickTax Standard but it looks like they throw in a similar feature called Audit Assistance for free.
Also new this year in QuickTax: a pension income optimizer to take advantage of the new rules that allow seniors couples to split pension income. To my knowledge, UFile was the only software that included an optimizer last year.
Now that QuickTax has increased the number of returns, would you consider going back? Have you been audited by the CRA? If so, what was your experience like? What is your take on Audit Defence? Is it, as Michael James wondered in a recent post, similar to extended warranties sold by retailers? Is this another instance where it is cheaper to self-insure (i.e. hire expert representation after the CRA sends an audit notice)?
[Edit: The original post incorrectly referred to QuickTax 2007. It has now been corrected]
