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The Right to Appeal to the Tax Court of Canada or Federal Court of Canada

If you disagree with a decision of the CRA or disagree with the tax the CRA claims you owe, you have a right to appeal this to the Tax Court of Canada. Our tax litigation lawyers represent you in the Tax Court of Canada, a specialized court in Canada that has exclusive jurisdiction to handle tax court appeals. If you believe that the CRA has acted improperly in rendering its decision, you may seek redress with the Federal Court of Canada, a court that reviews the actions of the CRA in order to ensure that it has complied with the law in reaching its decision.

Appeals to the Tax Court of Canada

If you disagree with a decision of the CRA or disagree with the tax the CRA claims you owe, you have a right to appeal to the Tax Court of Canada.

A Notice of Appeal to the Tax Court of Canada must be filed within 90 days from the date of the issuance of the Notice of Assessment. If you miss this deadline, there are mechanisms to file an Application for an Extension of Time to allow an additional 12 months to file the Tax Court Appeal.

The Tax Court of Canada has two streams available to taxpayers: the informal and the general procedure. The informal procedure is intended to handle lower amounts in dispute (the amount in dispute for each year is $25,000 or less), which is a process similar to the small claims court. The general procedure handles the remainder of actions where the full rules of evidence apply.

In both procedures, there is opportunity to settle the matter with the Department of Justice, who are the CRA’s lawyers, before the matter proceeds to trial.

Judicial Review by the Federal Court of Canada

An application for Judicial Review is not an opportunity to re-argue your case before the Federal Court. This is the proper jurisdiction of the Tax Court of Canada. Rather, Judicial Review is a unique method that allows the Federal Court to review the actions or decisions of the CRA and determine whether the CRA was reasonable or correct its application of the Income Tax Act. It is a means to hold the CRA accountable to the government. It is a means for the Federal Court to scrutinize CRA actions and punish it for behaviour that runs afoul of the law or behaviour that offends natural justice.

These types of behaviours can include aggressive behaviours of the CRA without lawful basis, the CRA’s refusal to consider proper evidence, the CRA’s refusal to lawfully open an objection to an assessment, and the CRA’s improper decision rendered against you.

FAQ’s:

If I disagree with the conclusions of the CRA on the notice of assessment, what should I do?

The first thing to do is to file a Notice of Objection. A Notice of Objection is a kind of internal appeal that can be filed with the CRA to dispute the amount of tax levied in a Notice of Assessment or Reassessment.

If you disagree with the findings of the CRA to your Notice of Objection, then the last recourse is to file an appeal with the Tax Court of Canada.

What is the Tax Court of Canada?

The Tax Court of Canada is a specialized court in Canada that has exclusive jurisdiction over legal tax matters. The Tax Court is the body of court or competition jurisdiction to handle all tax court appeals and tax reviews.

The Tax Court of Canada has the jurisdiction to hear a wide variety of appeals under several statutes such as the Excise Tax Act, the Employment Insurance Act, the Excise Act and the Customs Act. For most Canadians, the jurisdiction that is most relevant is of course the Income Tax Court’s jurisdiction to hear tax appeals arising from disputes with the Canadian tax department under the Income Tax Act.

What powers does the Tax Court of Canada have in terms of tax appeals?

The Tax Court has only three powers granted to it with respect to appeals of assessments and reassessments:

  • The Tax Court of Canada judge may confirm the assessment or reassessment issued by the CRA;
  • The Canada Tax Court judge can vacate the assessment, ordering the CRA to reconsider its decision and issue a reassessment to the taxpayer;
  • The Tax judge may also direct the Minister to reassess the taxpayer in accordance with his or her instructions, based on findings of fact determined at trial.

Where the extraordinary circumstance, the Tax Court of Canada has the discretion of offer the taxpayer interest or penalty relief based on the following:

  •  natural or man-made disasters, such as floor or fire;
  • civil disturbances or disruptions in services, such as a postal strike;
  • a serious illness or accident; or
  • serious mental illness or distress, such as death in the immediate family.
How long do I have to wait after receiving a Notice of Assessment before I can file an appeal with the Tax Court of Canada?

A Notice of Appeal to the Tax Court of Canada must be filed within 90 days from the date of the issuance of the Notice of Assessment. If you miss this deadline, there are mechanisms to file an Application for an Extension of Time to allow an additional 12 months to file the Tax Court Appeal.

In order to be successful with the request for an extension of time you must be able to demonstrate the following:

  • That within the appeal period:
    • You could not appeal or have someone else appeal for your; or
    • You intended to appeal;
  • That it would be fair to grant your application;
  • That you applied as soon as you could; and
  • That you have reasonable grounds for appealing.

Why you Need a Tax Litigation Lawyer

Whether you disagree with a decision of the CRA regarding the amount of tax claimed from you or the CRA has acted improperly in its rendering of a decision on your matter, our tax litigation lawyers can pursue an appeal the Tax Court of Canada or a Judicial Review application in the Federal Court to hold the CRA accountable.

With years of experience in corporate law and tax law, our tax litigation lawyers have the knowledge and tools to fight for your interests against the Department of Justice through a Judicial Review Application in the Federal Court of Canada.

For more information on appeals within the Tax Court of Canada, click here. For more information on appeals within the Federal Court of Canada, click here.

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