For individuals and business owners in Canada, handling a tax dispute could become a stressful process. Every individual should be aware of the basics of tax disputes and CRA tax appeal process.

The tax system in Canada is mostly a self reporting one. A taxpayer has the obligation to report the tax amount with transparency and with accuracy. It is expected out of each taxpaying individual at the time of filing the annual tax returns. The CRA processes these tax returns and takes a decision on the accuracy of the information that has been reported. CRA then provides the taxpayer with a tax assessment. This is the Notice of Assessment and is sent as a routine to each taxpayer some weeks after he or she files the tax returns.

The CRA has a right to request more information concerning the tax obligations. After an audit, the CRA may not agree with what has been reported on the tax returns and the auditor will have a proposal letter issued outlining the position of CRA and how the taxpayer can be reassessed. Individuals can take the help of professional tax lawyers who can give them advice about the audit process of CRA and represent them throughout this process.

The date featured on the Reassessment Notice is the beginning of the ninety day CRA tax appeal period. The proposal letter contains the information required if you want to dispute the tax amount, the interest calculated or the inclusion of penalties on account of the reassessment.

The objection in the form of a CRA tax appeal has to be sent to the Appeals Division of the Agency. The taxpayers get ninety days from the date of the Reassessment Notice to file the Objection Notice with the Chief of Appeals. This deadline is an important one and it cannot be missed. Tax lawyers assist the individuals in sending these objection notices.

In rare cases when the deadline of ninety days is missed, an extension to file late could be applied for. Time is allowed up to one year after the normal deadline. After receiving the Notice of Objection, the CRA reviews the application and decides whether the reasons supplied are in accordance with the CRA tax appeal rules.

An officer from the CRA Appeals Division is assigned to an individual?s file case. This officer could be from any CRA unit in Canada. The officer is assigned depending on the workload and may not be from the same city where you are residing. After receiving the CRA tax appeal, the officer handling that appeal has to either cancel the reassessment by vacating it or he or she may vary the reassessment. The reassessment can also be left alone by confirming it.

Specialized Tax Professionals would be able to guide the individuals on the streams that can be followed when filing a CRA tax appeal. There is a general procedure and an informal procedure. The procedure you would adopt will be based on the federal tax amount that is in dispute. Fees have to be paid for filing the Appeal Notice if it falls under the General Procedure rules. Informal Procedure is for small disputes and there is no fee required for filing.

When people receive a notice of tax assessment, they are advised to scrutinize the amount of income that is assessed along with deductions and allowances. They could either do it themselves or have these figures checked by?tax accountants.?The basis of the assessment on the Assessor?s Note has to be understood. There are cases when the allowances and the deductions are disallowed and the reasons for such dis-allowance have to be thoroughly understood. If there are disagreements with the assessment, a?tax objection?may be lodged and a?CRA tax appeal?may be filed if you are not happy with the response to your application.

How to start a tax objection

The initial step that has to be taken when resolving a dispute with CRA (Canada Revenue Agency) is to file a Notice of Objection. A?tax accountant?will apprise you of the procedure and give general information concerning the process of filing a?tax objection. There are different guidelines for individuals, corporations and certain provincial regions.

If action is not taken to challenge the notice of assessment, then the entire tax amount has to be paid to the CRA. In order to make up for the burden of proof which is laid on the shoulders of taxpayers, CRA has provided a division for internal appeals that allows the taxpayers an opportunity to go through a fair review without the hassles of getting involved in a court of law.

The deadlines of tax objection

Filing a?tax objection?does not cost anything. The procedure of filing may vary based on the type of assessment the objection is being made on. There are stringent deadlines that have to be met in terms of filing. If these deadlines are not met, then the taxes have to be paid in full unless taxpayers have solid ground to request for extension.

When there is a disagreement with the tax assessment, the first thing that has to be done is to approach the CRA to ascertain the discrepancies. There is a possibility of informally explaining the reasons for the?tax objection?on account of errors in the assessment and they can be resolved. If the CRA fails to make the necessary corrections before the deadline for filing an objection, a basic Notice of Objection can be filed to get the dispute noted on the file, explaining the whole chronology of events.

When you gather the information and have the documents that you need to back up your?tax objection, you can go ahead and file a complete Objection and add further information to the elementary notice you had filed earlier. All evidence and reasons have to be furnished to support your case.

The outcome of tax objections

The CRA response may be expected any time within a year from the date of filing your?tax objection. It is wiser to decide to pay your taxes in full in such a case so that there are no further debits of interest charges on your tax account while the?tax objection?is under process. When you get a response to your objection application and you are still in disagreement with their response, you have the right to file a?CRA tax appeal to tax court.

If you have unfair assessment and need to consider tax objection, contact Tax SOS, the tax objection veteran in the tax industry, for help at 1-877-982-9767 and get your free complementary consultation.