Does Interest Keep Running While Your CRA Objection Is Open in Canada?

You have filed, or are about to file, a notice of objection, and the disputed balance is sitting there. The worry is understandable: if the objection takes months, will the interest bill grow in the meantime?

This article explains how interest, payment and collection work while an objection is open, and what generally happens if you succeed. The rules differ between income tax and GST/HST, so keep them separate.

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

The short answer on interest

Yes. CRA says interest keeps accruing on disputed income tax during an objection. Filing the objection does not stop the interest clock.

Penalties and interest are part of the assessment itself, so an objection can dispute them as well. If you have paid some or all of the disputed amount and CRA agrees with you, the payment is refunded. How interest on the rest is adjusted depends on the outcome of your case, so it is worth confirming with a lawyer or accountant.

Pay now or wait: the two options

Generally, you do not have to pay disputed income tax until the objection review is complete. Amounts you were required to withhold and remit must still be paid on time, and collection is not postponed for them.

If you want to stop interest from growing, you can pay all or part of the disputed amount. Interest stops on the amount paid, and if CRA agrees with you the payment is refunded.

Can CRA collect while you object?

For income tax, once a notice of objection is served the Minister cannot take collection action on the disputed amount until 90 days after the notice of the decision confirming or varying the assessment is sent. CRA says it normally postpones collection until 90 days after it sends its decision.

If you then appeal to the Tax Court of Canada, collection of the disputed amount is barred until the Court's decision is mailed to you or you discontinue the appeal, whichever comes first.

There are exceptions. These restrictions do not apply to amounts that must be withheld and remitted, and certain other amounts and assessments listed in s.225.1, and CRA also lists cases where an amount is in jeopardy. A large corporation, meaning taxable capital employed in Canada with related corporations over $10 million, or a taxpayer in certain tax shelter cases, can be required to pay one-half of the assessed amount within 90 days of the notice of assessment.

GST/HST is different. CRA says it can keep collecting amounts you owe while a GST/HST objection is pending, unlike income tax, and interest still applies. You can pay all or part of the disputed amount to limit it.

If you win, and how long it can take

If you have paid the disputed amount and receive no decision within 120 days of filing, you can request a refund of it. The refund is limited to half for large corporations and charitable donation shelter cases.

Timing matters because interest runs while you wait. For income tax objections resolved in August 2026, CRA's average was 145 days for low complexity matters such as credits, deductions and the Canada child benefit, and 403 days for medium complexity matters such as business expenses, partnerships and T2 issues. High complexity matters, such as large corporations, transfer pricing and GAAR, took over 690 days. These are monthly averages and change, so check CRA's current page.

CRA's processing time counts the time the objection is within government control and excludes time you take to provide more information. Responding promptly to requests therefore helps.

What to do next

• Confirm whether your dispute is income tax or GST/HST, since collection rules differ.
• Decide with an accountant or lawyer whether to pay all, part or none of the disputed amount, weighing the cost of interest against cash flow.
• Keep paying amounts you were required to withhold and remit on time.
• Quote your case number in all correspondence, including any request for a refund of disputed amounts.
• Remember that asking CRA to cancel or waive penalties or interest is a separate request, not an objection, and the Minister may waive or cancel all or part of a penalty or interest up to ten calendar years after the end of the relevant year.

Frequently asked questions