Canada Child Benefit Reviews
The CRA frequently reviews claims for the Canada Child Benefit (CCB), a monthly cash payment program for parents of minors. The value of this benefit is based on family income, with payments reduced as family income grows. Reviews often follow changes in one’s relationship status, when one taxpayer begins to claim the benefit based on only their income, rather theirs and their former spouse’s. Because of the COVID-19 pandemic, CRA is not currently conducting reviews of eligibility for the CCB. However, the government has increased the value of the benefit, meaning that disputes over eligibility for 2020 will have higher stakes.
These reviews typically start with the CRA sending a questionnaire and requesting documents to verify your marital status and that you have custody of your children. If the CRA agrees that you claimed the CCB correctly, they will confirm this in writing and that is the end of it. However, these reviews are often contentious, involving repeated (and often frustrating) requests for documents to confirm eligibility. This often includes utility bills, report cards or other documents from schools, and signed letters from third parties. If the CRA decides you are not eligible, they will send you a “notice of determination”, will stop paying benefits, and may
While most Canadian tax disputes centre written exchanges between taxpayers and the CRA, they also generally involve telephone or in person discussion with the CRA’s representatives. However, CCB reviews generally only involve written communication—the reviewing agents typically do not provide a telephone number. This makes them particularly frustrating, as it can leave taxpayers guessing about why their request was denied.
Because of the informality of these reviews, the CRA often gives taxpayers a number of opportunities to make their case and will generally entertain additional submissions even after they have come to a decision. If it is still possible, it may be preferable to file a notice of objection to the notice of determination, as this makes it easier it easier to speak with the person handling the case and resolve any issues.
A particular indication that you may need to retain legal assistance with a child benefit review is if you continue to live in the same physical home as your former spouse. It is not uncommon for separated couples to continue living at the same address for financial reasons, notwithstanding that they are no longer romantically involved. “Separation” under Canadian tax law involves “living separate and apart” from your partner for a period of time as a result of the breakdown of your relationship. It is possible to do so under the same roof, as had been confirmed by the Tax Court in a number of cases—including in the cases of Perron v R, 2010 TCC 547 and Aukstinaitis, 2008 TCC 104.
However, CRA’s administrative practice specifically requires separated couples to provide proof that they lived at different addresses, making it difficult for taxpayers to defend their eligibility for the benefit. Without representation, it is quite difficult to point out that it is not necessary to live under different rooves to be separated.
Kalfa law can assist you in the course of CCB reviews, or help you contest the results of one through a notice of objection. We work with our clients to find fast, cost-effective, and tax-deductible solutions to CCB reviews and objections.
If the CRA concludes that you aren’t eligible for CCB, they will issue a “notice of determination”. They will stop paying CCB and may try to claw back prior payments.
If you think the CRA is wrong, you can file a notice of objection within 90 days of the date of the determination or request an extension of time to object within a year of that date. Alternatively, CRA will likely consider additional documents that are submitted through the review process.
This depends on exactly what the CRA is reviewing the claim for, and what they have requested. One helpful inclusion is letters from third parties verifying your marital status and custody of your kids. CRA generally requests letters from “authority figures” (schools, doctors, religious figures), but even letters from friends and family can significantly improve your odds of success.
–James Alvarez, Tax Counsel
© Kalfa Law, 2020
The above provides information of a general nature only. This does not constitute legal advice. All transactions or circumstances vary, and specified legal advice is required to meet your particular needs. If you have a legal question you should consult with a lawyer.