The Tax Court of Canada is a specialized court in Canada that has exclusive jurisdiction over tax matters. The Tax Court is the body of court that handles all tax court appeals in circumstances where the taxpayer has first exhausted his or her appeals with the CRA.
When a taxpayer objects to the CRA’s conclusion regarding how much tax he/she owes, he should first file a Notice of Objection before proceeding to the Tax Court of Canada. The Notice of Objection is a type of internal appeal that can be filed with the CRA to dispute the amount of tax levied in a Notice of Assessment or Reassessment. The CRA conducts a review process to determine if there is any merit to the objection. If you dispute the CRA’s notice of assessment or reassessment, you must file a Notice of Objection within 90 days from the date of the assessment.
Appeals to the Tax Court
If you disagree with a decision of the CRA as a result of the findings of the internal appeals officer, you have an additional right to appeal to the Tax Court of Canada. The Tax Court of Canada is a body of the court that hears disputes with the CRA when you’ve exhausted your appeal within the CRA.
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 Confirmation or the date of the decision of the internal appeals officer. 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). This process is similar to the small claims court in so far as there are relaxed rules of evidence and the process is streamlined to allow access to individuals who do not have a lawyer. The general procedure handles the remainder of actions where the full rules of evidence apply.
In both procedures, there is an opportunity to settle the matter with the Department of Justice, who acts as the CRA’s lawyers, before the matter proceeds to trial.
Federal Court of Appeal
If you believe that the findings of the judge in the Tax Court of Canada was an error of law or an error of finding of fact, you can appeal the matter to the Federal Court of Appeal.
Unlike the Tax Court of Canada, which deals exclusively with tax issues, the Federal Court of Canada and Federal Court of Appeal has jurisdiction over a wide berth of portfolios impacting Canadians, including immigration and the environment.
What is Judicial Review?
Judicial Review is a mechanism by which the Federal Court can review the actions or decisions of the CRA. The purpose of judicial review is to ensure the CRA has complied with the law in reaching its decision and that the decision was reasonable.
An application for Judicial Review is not an opportunity to re-argue your case before the Federal Court. That 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.
Why you Need a Tax Lawyer
If you disagree with a decision of the CRA or the amount of tax claimed from you, you have rights available to you. You need strong and experienced counsel to appeal the decision or assessment either internally through the Objection process or externally to the Tax Court of Canada.
If your circumstances demonstrate that the CRA has acted improperly or has rendered an improper decision on your matter, we can pursue a Judicial Review application in the Federal Court to hold the CRA accountable.
With years of experience in corporate and tax law, we have the knowledge and tools to fight for your interests against the Canada Revenue Agency in the Tax Court of Canada or through a Judicial Review Application in the Federal Court of Canada.
-Shira Kalfa, BA, JD, Partner and Founder
© Kalfa Law 2019