Can You Appeal to the Tax Court of Canada Without an Objection?

You received a notice of assessment, disagreed with it, and let the objection stage slide. Now you are wondering whether you can go straight to the Tax Court of Canada and ask a judge to look at it.

The short answer is that the law is built around objecting first. This article explains how the steps fit together, what the exceptions look like, and what options may remain if you missed the objection deadline.

This article covers Canadian federal tax law, which applies in every province.

How the objection and appeal steps fit together

Under the Income Tax Act, a taxpayer may appeal to the Tax Court of Canada to have an assessment vacated or varied after serving a notice of objection and once the Minister has confirmed the assessment or reassessed. The appeal is therefore written as the second step, following the objection.

A notice of objection must be in writing and set out the reasons and all relevant facts. When the Minister receives it, the Minister must reconsider the assessment with all due dispatch, then vacate, confirm or vary it, or reassess, and notify you in writing. That written decision is what normally opens the door to the Tax Court.

The objection deadline

For individuals (other than trusts) and graduated rate estates, the objection deadline is the later of one year after the filing-due date or 90 days after the notice of assessment was sent. For others, it is 90 days.

There is a narrower rule where the Minister assesses to reflect certain matters already determined. In that case the objection must be made within 90 days, and the objection and appeal are limited to reasons that cannot reasonably be regarded as already dealt with.

Exceptions and special situations

Several situations work differently from the ordinary path. Whether one applies to you depends on the facts, so it is worth confirming with a lawyer or accountant.

• Ecological gifts: an appeal of the Minister of the Environment's confirmation or redetermination of fair market value must be made within 90 days after that Minister issues the certificate under s. 118.1(10.5).
• Waivers: you cannot appeal an issue on which you waived in writing the right to object or appeal.
• Large corporations: an appeal is limited to issues properly raised in the notice of objection.
• Waiting without an answer: if the Minister has not notified you of a decision, you may appeal once 90 days have passed after service of your notice of objection.

If you missed the objection deadline

A late objection is handled differently from a late appeal. You first apply to the Minister (Chief of Appeals) under s. 166.1, within one year after the objection deadline. You must show that you were unable to act or had a bona fide intention to object, that granting the request is just and equitable, and that you applied as soon as circumstances permitted.

Do not confuse this with the Tax Court's power to extend the time to appeal. That power deals with a missed appeal period, and the application must be made within one year after the 90-day appeal period expires.

Penalties and interest have another route. The Minister may waive or cancel them under s. 220(3.1) on or before the day that is ten calendar years after the end of the taxation year. This is an administrative relief decision, not a Tax Court appeal. If a relief request is refused, a second administrative review is offered, and you can apply to the Federal Court for judicial review within 30 calendar days of receiving the decision.

What to do next

• Find the date on your notice of assessment and work out your objection deadline.
• Check whether you ever served a written notice of objection, and keep proof of when it was sent.
• If the deadline has passed, look at the late-objection application to the Minister, which has its own one-year limit.
• Consider whether penalty or interest relief might fit your situation instead.
• Speak with a tax lawyer or accountant before relying on any exception, because timing errors are hard to undo.

Frequently asked questions