All You Need To Know About Your Notice Of Assessment & Notice of Reassessment
Want to understand what your Notice of Assessment & Notice of Reassessment means?
Each year Canadians file an income tax and benefit return to report their annual income to Revenue Canada, claiming all relevant deductions or credits that may apply. The CRA, in turn, calculates how much tax the taxpayer owes or whether he will receive a refund.
Once the CRA receives your tax return, it will issue a Notice of Assessment (NOA) that includes a tax assessment summary and outlines the following key line numbers and amounts:
- Refund or balance owing: The CRA’s Notice of Assessment lets you know if you are getting a refund or if you have a balance owing. You will also see if any corrections have been made to your return.
- Total household income: That figure is used to determine if you are eligible for several programs.
- Application for a GST/HST rebate including corrections that have been made on your rebate application.
- RRSP deduction limit representing the maximum amount that you can contribute to your RRSP.
- Repayment required for the Home Buyers’ Plan: If you have benefited from a home tax deduction and withdrawn money from your RRSP for the Home Buyers’ Plan, your Notice of Assessment indicates what you need to repay in the current tax year.
- Tuition, education and textbook carry forward amounts: As part of student tax deductions, this is the amount you can carry forward indefinitely if you do not need the full tuition, education and textbook amounts to reduce your tax payable to zero.
- Unused net capital losses: Those unused net capital losses can be carried back three years and carried forward indefinitely to be applied against capital gains.
- TFSA: Your Notice of Assessment shows your TFSA contributions, withdrawals and unused contribution room.
How Long Does It Take to Get Your Notice of Assessment?
It will take a few weeks to receive your notice of assessment in the mail, if it was sent in advance of the deadline. However, it may take considerably longer if you filed your return close to the deadline.
If you would like to access your NOA more quickly, then having an online account with the CRA will be beneficial. Having an online account through the MY Account section of the CRA will allow you to download your assessment or review it at your convenience.
Notice of Objection
Once you receive your NOA, you may disagree with the CRA’s review. You have 90 days from the date that it was issued to appeal the information with the CRA. You may contact the agency as the first line of response and then file a Notice of Objection. Your Notice of Objection should outline the reasons for your objections and provide any supporting documentation. Once the CRA reviews your evidence, they will either agree and send you a Notice of Reassessment, or, in the event that they disagree, send you confirmation of the original Notice of Assessment.
If you disagree with the Notice of Reassessment, then, as before, you have 90 days to file an appeal.
Notice of Reassessment
As mentioned above, a Notice of Reassessment may be generated when you file a notice of objection to the original NOA. Should the CRA agree with your objection, it will reissue an amended notice of reassessment.
However, a notice of reassessment may also take place as part of a random review or when the CRA has a suspicion of fraud. In that case, the CRA may go back three years or more to ask for more information.
Your income tax and benefit return may be selected for review for a number of reasons. These include
- your compliance history;
- the types of deductions you claimed; or
- the information on your return does not match the information from third party sources such as T4 slips.
You should keep your income tax records, including all receipts and documents to support your claims, for at least six years in case your return is selected for review. The CRA may also ask for other documents, such as cancelled cheques or bank statements, as proof of any deduction or credit you claimed.
Be sure to submit any requested information in a timely manner. You can submit them online through the CRA MyAccount portal or send them by mail or fax.
If you are in dispute at any point with the CRA or you do not feel that the assessment is correct, it is best to consult with an experienced tax lawyer to ensure that your interests are always protected.
Specifically, if the CRA has issued a Notice of Reassessment by contacting you through the pre-assessment or post-assessment review departments, you will want to retain a tax lawyer to provide the information requested. Tax lawyers not only submit the information on your behalf, they also prepare comprehensive submissions that outline your entitlement to any benefits, credits or deductions that you claimed.
Request for Information & Adjustment Request
There are other mechanisms that the CRA may use to review your file other than the notice of assessement or reassessment; these include the Request for Information and Adjustment Request.
Request for Information
A request for information is often mistaken for an audit. It is simply a request by the CRA for more information to support something that appeared on your tax return. Common information requests are for home office expense claims, medical expenses, and tuition receipts.
An adjustment request allows you to amend any errors or omissions that you may have made. Forgot to include your child-care expenses? Simply file an adjustment return to correct the error.
You work hard for your money. Kalfa Law works hard for you to keep it.
- 10% of the amount you failed to report on your return
- 50% of the difference between the understated tax (and/or overstated credits) related to the amount you failed to report and the amount of tax withheld related to the amount you failed to report
- 50% of the understated tax and/or the overstated credits related to the false statement or omission
-Shira Kalfa, BA, JD, Partner and Founder
Shira Kalfa is the founding partner of Kalfa Law. Shira’s practice is focused in corporate-commercial and tax law including corporate reorganizations, corporate restructuring, mergers and acquisitions, commercial financing, secured lending and transactional law. Shira graduated from York University achieving the highest academic accolade of Summa Cum Laude in 2012. She graduated from Western Law in 2015, with a specialization in business law. Shira is licensed to practice by the Law Society of Ontario. She is also a member of the Ontario Bar Association, the Canadian Tax Foundation, Women’s Law Association of Ontario, and the Toronto Jewish Law Society.
-Shira Kalfa, BA, JD, Partner and Founder
© Kalfa Law 2019