We handle all types of tax matters, from CRA collections to CRA Audit and Tax Court representation
SpenceDrake Tax Law offers over a decade of experience with complex tax cases. Our expertise includes resolving disputes with CRA and provincial tax authorities and protecting taxpayer rights. We also provide tax opinion, planning, and business law services.
Appealing a Tax Assessment - Notice of Assessment, Reassessment, Confirmation, Determination, Redetermination*
When a taxpayer files a tax return, the Canada Revenue Agency (CRA) reviews the tax liability and issues a Notice of Assessment or Notice of Reassessment detailing the tax liability according to their analysis. A taxpayer may request a determination of losses in which case the CRA would issue a Notice of Determination or Notice of Redetermination. Within a certain period, a tax return may be subject to a CRA audit and/or a reassessment of tax liability, ending with a Notice of Reassessment. Each of the aforementioned notices result from a CRA assessment of tax liability. Tax Lawyers specialize in disputing or appealing tax assessments.
Notice of Objection
If a taxpayer is not in agreement with CRA’s tax assessment, it can be disputed by filing a Notice of Objection. The objection must be filed within 90 days of the date on the notice. If the deadline is missed, an extension request can be made within 1 year of the 90 day deadline. In that request, the taxpayer has to explain to CRA why the objection was not filed within the 90 day period. Extension requests are rarely denied in this context.
CRA cannot collect tax in dispute except for amounts considered to be held in trust by the taxpayer for the government, such as GST/HST and payroll deductions. So, if a Notice of Objection is filed for personal or corporate income tax owing, CRA must cease collections action, for example lifting the hold they may have on a bank account.
Making your case - What to Include in a Notice of Objection?
In the Notice of Objection, the taxpayer must provide written facts and arguments stating the reasons for disagreeing with CRA’s tax assessment. The objection can then be mailed/faxed/or uploaded to the taxpayer’s online CRA account. The appeals division of the CRA will inform the taxpayer when the objection has been recorded as received by CRA. Then an officer from the CRA’s appeals division will be assigned to review the objection. The initial acknowledgement of receipt of the Notice of Objection may take months and waiting at least an additional 6 months for contact from a CRA Appeals Officer is not uncommon.
During the review, there will likely be a back and forth exchange of written arguments and supporting documentation between the taxpayer and the Appeals Officer.
After the Notice of Objection?
Once the review by the Appeals Officer is concluded, the CRA appeals branch will either confirm that the taxpayer’s objection is valid, in part or full, and modify the tax liability, modify the tax liability regardless of the taxpayer’s position, or confirm the original tax liability (Notice of Confirmation).
If there are no further issues with CRA’s position, and there is tax owing, a payment plan can be arranged or the amount can be paid in full. However, if a taxpayer does not agree with the decision of the Appeals Officer, an appeal can be filed to the Tax Court of Canada.
For the greatest chance of success, advice from a Tax Lawyer for the objection process is recommended. Depending on the scope of the matter, it may be necessary for a Tax Lawyer to work in conjunction with an accountant or bookkeeper for an ideal outcome.
Notice of Appeal - Appealing to the Tax Court of Canada
A taxpayer has 90 days from the date of the CRA’s objection decision (Notice of Reassessment, Notice of Confirmation/Redetermination) to file a Notice of Appeal document with the Tax Court of Canada. Again, in some circumstances this deadline can be extended with a request to the Tax Court. In that request, the taxpayer must explain why they were unable to file on time and that the Notice of Appeal was filed as soon as possible once it was realized the initial deadline was missed. Extension requests to Tax Court are not as commonly accepted as they are to the CRA.
It is important to consult with an experienced Tax Lawyer when considering an appeal to Tax Court. The CRA will be represented by Tax Lawyers from the Department of Justice.
Contact us for free consultation. We will review your facts and outline the steps necessary to challenge CRA’s position.