Can the CRA challenge my price allocation years after the sale has already closed?

Yes. A purchase price allocation isn't locked in simply because both sides agreed to it and the deal closed; it's reflected in tax returns, and the CRA generally has a standard period after a return is filed within which it can reassess it, which can extend considerably further if the CRA considers there was a misrepresentation in how the allocation was reported. In practice, this means a challenge to an allocation made years ago is a real possibility, not just a theoretical one, particularly if the allocation looks aggressive or inconsistent between what the buyer and seller each reported.

This is one of the reasons a well-documented, commercially defensible allocation matters long after closing, not just at the negotiating table: if the CRA does raise the allocation years later, having contemporaneous evidence of how the numbers were actually arrived at (appraisals, financial statements, negotiation records) is what supports the position on review, rather than trying to reconstruct a justification after the fact.

Keeping the purchase agreement, supporting valuation materials, and both parties' tax filings consistent and well-organized from the outset is the practical protection against a challenge showing up long after the transaction is otherwise forgotten.