Free Tax Engagement Letter Generator for Canada (T1 and T2)

How this letter is built

Your answers pick clauses. The clauses build the letter, the scope matrix and the review list.

Built from a clause library, not written from scratch.

Every sentence in your letter comes out of a set of 49 versioned clause templates. Your answers pick which ones apply. Nothing is generated at runtime, and no model rewrites your fee terms on the way past.

That matters because a compliance-only filing engagement can end up reading as though you were giving advice, once last year's scope comes along for the ride. Versioning keeps the changes traceable. Change an answer and the letter changes with it.

What we name, and where it came from
Where the letter names a CRA form, a service or a rule, we took the words from the Agency's own page and wrote down where we read them. Form T183 and Form T183CORP, Form AUT-01, the authorization routes, the six-year records rule: every one of them comes from a named CRA page rather than from memory. You'll find the source behind the small information mark on each control.
What we won't name
The legal name of your provincial body. The complaints route it wants you to publish. Whether a liability cap holds where you practise. What a compilation communication has to say. We couldn't source any of those to a primary publisher, so we ask you to write them and then put them on your review list. An honest gap beats a confident guess on a document your insurer reads.
What we refuse to build
No audit, review or other assurance engagement. No compilation engagement: preparing or compiling financial information may require a separate written scope under the standards that apply to your practice. No bookkeeping or payroll engagement. No French text, and no automatic provincial-return scope. Those aren't missing features. They're the boundary.

And one thing we refuse to guess. Where your practice is based doesn't tell us which privacy law your letter should name, whose law governs the engagement, or whether your client files a provincial return. Four separate questions, four separate answers, so we ask you all four instead of inferring three of them from one. On the privacy wording and on a paper corporate return we go further and ask you to confirm, and we won't release the letter until you have.

What goes in a Canadian tax engagement letter

Fourteen clauses are in every T1 letter built here and cannot be switched off, at any length setting. Fifteen on a T2. That count doesn't change with where you are.

The letterhead
The addressee
The subject line
The confirmation of the engagement
The return you are preparing
Prepared from what the client gave you
No audit, no review, no assurance
The client's responsibility for completeness
The client's records
Your payment terms
The acceptance block
The printed footer
One filing period, and nothing after it
A line about provincial scope

That last one has two forms and you get exactly one of them. Tell us your client files a separate provincial return and the letter names it and says this engagement doesn't cover it. Tell us they don't, or that you haven't confirmed it yet, and the letter says the engagement covers the federal return and nothing filed separately from it. There's no third state where the letter goes quiet about it.

On a T2 there's one more: you are not preparing financial statements.

The rest is yours to set. Fees, deadlines, who deals with CRA when the review letter arrives in September, whether you cap your liability, whether you sign it too. Beyond the locked clauses, your answers choose among the conditional and optional terms that apply to the return type.

Questions accountants ask about engagement letters

Does an engagement letter need to be signed by both parties?

Practice differs, and we don't pick a side. Some firms treat the client's signature as the whole of it. Others counter-sign to show the terms were accepted on both ends, and some professional bodies have a view. The counter-signature line is a switch in step 5, off by default, and the note beside it says exactly that.

Do I need a new engagement letter every year?

Every letter built here covers one filing period. Build a fresh one each season and the scope and the fee terms match the work in front of you. Your professional body's rules still govern your practice, and they are the ones to check.

Do you need an engagement letter for a compilation?

We won't build that one. Compilation work may carry separate written-term requirements under the standards that apply to your practice, so confirm the current requirements with your professional body. We left that engagement out rather than approximate it. On a T2 the letter says plainly that you are not preparing the statements.

What is an engagement letter in accounting?

It's the document that says what you're doing, what you're not doing, what it costs and who is responsible for what. In a fee dispute or a complaint, it's the first thing read back to you. That's why the scope paragraph matters more than the fee paragraph, and why this page starts with what's in and what's out.

Do I need an engagement letter for bookkeeping services?

Not one from here. A recurring bookkeeping service has a different scope, fee cadence and termination shape from an annual return, so we haven't tried to cover both in one document. Bookkeeping shows up on this page only as an exclusion clause, and it's on by default.

Who can sign an engagement letter?

Step 1 asks for the T1 client or, on a T2, a signing officer by name. We cannot decide who has the authority to bind a client or a corporation. If one letter covers several family returns, confirm who has to accept it under your practice rules and the client's own circumstances.

Does this letter cover my client's provincial return?

No, and step 2 asks you outright so the letter can say so. Where your practice is based can't answer it: this is a fact about your client or their corporation. CRA's own T2 page says the T2 serves as the provincial and territorial return unless the corporation is located in Quebec or Alberta, and then a separate provincial corporate return is filed as well. Tell us which applies and the letter names it and puts it out of scope. Scoping that filing, and any language requirement it carries, stays yours.

Can I still write that I'm filing a T2 on paper?

Yes, and we'll ask you why before the letter comes out. CRA requires corporations to file the T2 electronically for tax years starting after 2023, names four exceptions (insurance corporations, non-resident corporations, corporations reporting in functional currency, and corporations exempt from tax payable under section 149 of the Income Tax Act) and charges a $1,000 penalty for non-compliance. Pick the one you're relying on, or say the tax year started before 2024, and confirm it. We don't test it against your client's facts, and the letter never claims an exception applies.

Can I put my designation in the letter?

You type it and it prints exactly as typed. We assert nothing about it, we don't check it, and we never fill it in for you. Plenty of people preparing Canadian returns aren't CPAs, and a generator that quietly writes a designation into a letter is creating an exposure rather than saving a minute.

A tax engagement letter template that starts Canadian

A tax engagement letter template you found online was almost certainly written for the United States. It names the IRS, it talks about Form 1040, and a Canadian preparer spends the first twenty minutes translating it before the first useful edit. This one starts Canadian: T1 and T2, tax year and fiscal year end, GST/HST, information slips, reassessment, Represent a Client.

It's a generator rather than a download. Answer six steps, watch the letter assemble, and leave with three things: the letter, a scope matrix that shows what's in and what's out at a glance, and a list of what you still have to confirm against your own body's guidance.

We're not your professional body, your insurer or your lawyer, and this is a draft for you to review and adapt before you send it. An engagement letter is the document that gets read back to you after a dispute, so read it properly before it goes out.

Where to go next

You've just written this season's engagement letter.

The person you're onboarding found you somehow. Next season's client is looking now. We list accounting practices across Canada by city and category, and if your firm is already here the page is yours to take over: find your listing, click "Claim this business", and verify you own it.

Claim your firm's listing

Or start where your clients look:

Or by province:

Two more tools from us.

The year felt full, so where did the money go?
What the practice has to bill, worked out before you put a fee in a letter.
How do I answer this inquiry without taking the case?
For the inquiry that lands mid-season and isn't work you want to take on.

Keep this one. There's no account and we save nothing, so bookmark the page and it will be waiting for the next client you onboard.

What has to go in this client's engagement letter?

Who is this letter for?

What is in, and what is out?

What does it cost, and when do you get paid?

What does the client have to do?

Which optional clauses do you want?

Read it before you send it