This case offers a good review of the kinds of documents CRA may examine for a net worth assessment:
"the CRA auditor obtained further information by issuing requirements for information. I will not mention all the documents that were obtained by the CRA auditor as they are too numerous. However, some of the documents obtained for the taxation years under appeal were instrumental in determining the income of the Elmansours and they are bank account statements, credit card statements, applications for credit cards, car registrations from the Société de l’assurance automobile du Québec, contracts for the purchase of vehicles from dealerships, insurance contracts, documents of incorporation, corporate documents from CIDREQ, invoices relating to Mr. Elmansour’s businesses, financial statements, documents relating to the house in Ajax, and Equifax reports. Although a net worth assessment is never perfect, the net worth assessments in these cases were well documented." (Para. 49.)
In his struggle to explain how he could support his family of seven and buy at least two homes and start or buy three businesses (to satisfy Canadian immigration laws), the taxpayer showed his bank accounts in the United Arab Emirates. And so he helped CRA justify late reassessments because he hadn’t reported owning more than $100,000 of property in the UAE on page 2 of the T1 and hadn’t reported his offshore income (para. 41.)
Justice D'Auray had no trouble agreeing that the Minister had proven gross negligence to justify the 50% penalty in ITA s. 163(2) for both Mr. and Mrs. Elmansour.
See Elmansour v. The Queen, (2014 TCC D'Auray)