by Bhavika Chadha

by Matthew Pollock

Income TaxApril 15, 20251 comment

Income Tax Objections: How to Dispute a CRA Assessment

Dealing with a tax assessment from the Canada Revenue Agency (CRA) can be overwhelming, especially if you believe the assessment is incorrect. Fortunately, Canadian taxpayers have the right to file a formal dispute, called the Notice of Objection, to dispute an assessment or reassessment issued by the CRA.

An objection is a formal process that allows taxpayers to challenge the CRA’s decision regarding their tax liability, deductions, credits, or any other aspect of their tax return. Understanding how to file an objection and what to expect during the process is crucial for protecting your rights.

What is an Income Tax Objection?

An income tax objection is a formal response to a Notice of Assessment (NOA) or Notice of Reassessment (NOR) issued by the CRA. If you disagree with the information on these notices, you can file an objection to request a review.

The objection process allows you to present additional information or clarify issues that may have been overlooked or misinterpreted by the CRA. Successful objections can result in adjustments to your tax liability, leading to reduced taxes, including the removal of penalties and interest.

When Should You File an Income Tax Objection?

You should file an objection if:

• You believe the CRA misinterpreted the facts or tax laws.

• The CRA disallowed deductions or credits that you believe are valid.

• You received a reassessment that increases your tax liability without a valid reason.

• You disagree with a penalty or interest charge levied by the CRA.

• The CRA made an error in calculating your income, expenses, or tax credits.

Time Limits for Filing an Objection

It is crucial to file your objection within the designated timeframe:

• Individuals and Sole Proprietors: Within 90 days from the date on your Notice of Assessment or Reassessment.

• Corporations: Also within 90 days of the notice date.

• Late Filing: If you miss the deadline, you can apply for an extension of up to one year, but you must explain why you missed the initial deadline. Granting of this extension is at the CRA’s discretion.

Failing to meet these timelines may result in losing your right to dispute the assessment.

How to File an Income Tax Objection

1. Gather Necessary Documents

Before filing, collect all relevant documents to support your objection, including:

• The Notice of Assessment or Reassessment you are disputing.

• Tax returns and supporting documents (receipts, invoices, contracts).

• Correspondence with the CRA related to the issue.

• Financial statements if you are a business owner.

2. Information to include with the Notice of Objection 

A Notice of Objection must include:

• Your personal or business information (name, SIN, business number, trust account number).

• The tax year or period under dispute.

• Detailed reasons for your objection, including the date of the NOA or NOR, reasons why you disagree and the changes you are seeking.

• Supporting documents that back your claim.

• A telephone number to contact you

3. Submit Your Objection

You can file your objection using one of the following methods:

• Online: Use the CRA’s My Account, My Business Account, or Represent a Client portals.

  • Select “Register my formal dispute”
  • Input the requested information. Once registered, you will receive a case number. You must submit your supporting documents to that specific case number.
  • To submit supporting documents, go to “Submit Documents Online“
  • Your objection will be sent directly to the CRA for validation and review.

• Mail: Send the completed T400A form and documents to the Chief of Appeals at your regional tax office.

Submitting your objection online is often faster and allows you to track the status of your submission.

What Happens After Filing an Objection?

After you file, the CRA will:

• Acknowledge your objection and assign it to an Appeals Officer.

• Review the objection and any supporting documentation.

• Contact you if additional information is needed.

The CRA aims to resolve most objections within 180 days. However, complex cases may take longer. During the review, the CRA may:

• Adjust your tax assessment.

• Uphold the original assessment.

• Reduce or eliminate penalties and interest.

Possible Outcomes of an Income Tax Objection

The outcome of your objection may include:

• Reassessment: Adjusting the amount owed or refunding overpaid amounts.

• No Change: The CRA upholds the original assessment.

• Partial Acceptance: Some adjustments are made, but not all issues are resolved in your favor.

If you disagree with the CRA’s final decision, you have the right to appeal to the Tax Court of Canada within 90 days of receiving the Notice of Confirmation.

Common Reasons for Denied Objections

The CRA may reject your objection if:

• The objection was filed late without a valid reason.

• You did not provide sufficient evidence to support your claim.

• The CRA believes that tax laws were correctly applied in your original assessment.

• You failed to respond to CRA requests for additional information.

Tips for a Successful Income Tax Objection

• Provide Detailed Explanations: Clearly explain why you believe the assessment is incorrect.

• Be Thorough with Documentation: Attach all relevant financial records and correspondence.

• Stay Organized: Keep copies of all documents and correspondence.

• Follow Up Regularly: Monitor the status of your objection through your CRA account and if possible, maintain consistent communication with the Appeals Officer.

• Seek Professional Assistance: Consulting a tax lawyer can increase your chances of a favorable outcome.

How a Tax Lawyer Can Help

Filing an income tax objection can be complex and time-consuming. A tax lawyer can:

• Evaluate your case and determine the best grounds for objection.

• Draft and file the objection on your behalf, ensuring accuracy and completeness.

• Represent you in discussions with the CRA Appeals Officer.

• Prepare for potential litigation if the objection is denied.

If you are dealing with a tax assessment or reassessment that you believe is incorrect, professional guidance can make a significant difference in the outcome.

Schedule a free consultation with Rosen & Associates Tax Law to discuss your case and explore your options for filing an income tax objection.

***Disclaimer: This article provides information of a general nature only. It does not provide legal advice nor can it or should it be relied upon. All tax situations are specific to their facts and will differ from the situations in this article. If you have specific legal questions, you should consult a lawyer.