Does CRA Collect While Your Tax Court Appeal Is Pending in Canada?

If you disagree with an assessment, a natural worry is whether the CRA can still ask for payment, or take collection action, while the dispute is unresolved. The answer turns on details of your account and on the stage your dispute has reached.

This article explains the stages of an objection and appeal and the relief options that exist outside them. It does not set out collection rules for your situation, so treat it as background and confirm your position with a lawyer or accountant.

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

Where your dispute sits in the process

Disputes usually start with a notice of objection. It must be in writing and set out the reasons and all relevant facts. For individuals other than trusts, and for graduated rate estates, the 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.

On receiving the objection, the Minister must, with all due dispatch, reconsider the assessment and vacate, confirm or vary it or reassess, then notify you in writing.

When you can go to the Tax Court

Once the Minister has confirmed the assessment or reassessed, you may appeal to the Tax Court of Canada to have the assessment vacated or varied. The deadline is 90 days from the day the notice of confirmation or reassessment was sent to you.

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, and you need not wait for CRA Appeals to decide. For GST/HST objections the wait is 180 days.

What this article cannot tell you

The rules on whether and how the CRA may collect a disputed amount, and how interest builds up, depend on the type of tax, the stage of the dispute and your account. They are not something to guess at. Ask the CRA what it considers collectible on your account, and have a lawyer or accountant explain the options before a deadline or collection date arrives.

Do not assume that filing an objection or appeal stops all contact from the CRA. Keep answering its letters and calls, and keep records of what is said.

Relief and settlement options

• Settlement: with your written consent, the Minister may at any time reassess to dispose of an appeal.
• Penalty and interest relief: the Minister may waive or cancel penalties or interest on or before the day that is ten calendar years after the end of the taxation year, as an administrative decision rather than a Tax Court appeal.
• Review of a refusal: the CRA offers a second administrative review, and you can apply to the Federal Court for judicial review within 30 calendar days of receiving the decision.
• Judicial review timing: an application must generally be made within 30 days after the decision is first communicated, and a Federal Court judge may allow a further period.

What to do next

• Write down the dates on your notice of assessment, objection and any CRA decision.
• Diarize the objection and appeal deadlines.
• Get a current statement of your account and ask the CRA what is being asked of you.
• Keep copies of every letter, call note and payment.
• Speak with a lawyer or accountant about your collection exposure and whether a relief request makes sense.

Frequently asked questions