Do You Have to Pay Disputed Tax During a CRA Objection in Canada?

A large reassessment can create a hard question: do you have to pay it now, or can you wait while the CRA reviews your objection? The answer depends on the type of tax and on what the amount is.

This article walks through the general income tax rule, how interest behaves, the exceptions, and how GST/HST differs. It is not a substitute for advice on your own file.

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

The general rule for income tax

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.

The Income Tax Act backs this up. After a notice of objection is served, the Minister cannot take collection action on the disputed amount until 90 days after the day 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.

Interest keeps running

Not having to pay does not mean the amount stops growing. Interest keeps accruing on disputed income tax during an objection. Paying all or part of the disputed amount stops further interest on the amount paid, and if the CRA agrees with you, the payment is refunded.

So you are weighing two things: the cash you would tie up now, and the interest that may build over the months an objection can take. CRA's recent averages for income tax objections resolved in August 2026 were 145 days for low complexity matters and 403 days for medium complexity matters, with high complexity over 690 days. These are monthly averages and change, so check CRA's current figures.

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

If you go to the Tax Court

Once a taxpayer appeals to the Tax Court of Canada, collection of the disputed amount is barred until the Court's decision is mailed to the taxpayer or the taxpayer discontinues the appeal, whichever comes first. The same applies to a question referred to the Court.

Exceptions that change the picture

• The collection restrictions do not apply to assessments under sections 152(4.2), 169(3) or 220(3.1), or to amounts under Part VIII, section 281, amounts that must be withheld and remitted, certain section 116 tax, and related penalties and interest. CRA also lists cases where an amount is in jeopardy.
• A large corporation (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. CRA says they must pay 50% of the disputed amount.
• Any part of the assessment you are not disputing is not covered by the objection. A lawyer or accountant can help sort out which amounts are in dispute.

GST/HST is different

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

A few other GST/HST points are worth knowing. The objection deadline is 90 days after the day the notice of assessment is sent. A Tax Court appeal is available once the Minister has confirmed or reassessed, or 180 days after the objection was filed with no decision. Do not assume the income tax timing applies, because income tax allows an appeal after 90 days without a decision.

What to do next

• Identify the type of tax (income tax or GST/HST) and whether any part is a withholding or remittance amount.
• File the objection on time so the income tax collection protection can apply.
• Decide with a lawyer or accountant whether to pay all or part of the disputed amount to stop interest.
• If you are a large corporation or in a tax shelter case, plan for the one-half payment.
• Keep your case number and use it for any separate request, such as a refund of disputed amounts sent to the Chief of Appeals.
• If you have already paid and 120 days pass with no decision, consider requesting a refund.

Frequently asked questions