What is the CRA Reassessment Period?
Information on the CRA reassessment period and how far back the CRA can go when reviewing or auditing your tax returns.
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Information on the CRA Reassessment Period
When you first file your tax return, the Canada Revenue Agency (CRA) conducts an initial review. After this is complete, you will receive a Notice of Assessment. However, this isn’t the only time that the CRA can review your taxes.
There is a CRA reassessment period during which the agency can go back, review your tax return, and issue a Notice of Reassessment. This replaces your Notice of Assessment.
The CRA has three years from the initial Notice of Assessment to reassess a tax return. This means that if you received your initial assessment in May 2015, the CRA reassessment period for this return lasts until May 2018.
However, if the agency suspects fraud, negligence, or carelessness, it can extend the CRA reassessment period as necessary. Therefore, you could potentially have your taxes reassessed after the three-year period expires. This is one reason why the CRA recommends that people retain their tax records for at least six years. If the agency goes back and reassesses your returns, and you disagree with the reassessment, you will need to provide documentation to support your case.
Objecting to a CRA Reassessment
If the Canada Revenue Agency reassesses your tax return, you have two basic options. You can agree with the reassessment. If you do, you can pay the tax owing as stated in the Notice of Reassessment and there is nothing else for you to do. If you aren’t able to pay the outstanding tax debt in full right away, you should speak with a tax professional before agreeing to any sort of payment plan with the CRA. The agency can be very difficult to deal with, especially when you owe money, and it will often be very aggressive when arranging a payment plan. Trust a professional to give you the best possible outcome.
If you disagree with the reassessment, you can file a Notice of Objection. You have 90 days from the date on the Notice of Reassessment to file a Notice of Objection. Once the CRA receives your objection, it will review your case. You must be able to support your objection with documentation and evidence. Working with an experienced tax expert will give you the best chances of success.
In addition, after reviewing your objection, the CRA may attempt to negotiate a solution with you. Negotiating with the CRA on your own is not advisable. It is best to work with a trusted professional who understands how the CRA works and knows what to expect. At Farber Tax Solutions, our team is made up of legal, accounting, and ex-CRA professionals who have the experience you need to successfully communicate and negotiate with the CRA.
If your taxes are reviewed and reassessed during the CRA reassessment period, how you respond is critical. Talk to our team today to find out how we can help
Farber Tax Solutions can help you successfully deal with CRA problems. We utilize the experience of our tax experts to:
- 1| Offer a comprehensive solution that is focused on achieving the most favourable possible outcome for your tax issue;
- 2| Communicate with the CRA on your behalf and navigate the entire CRA dispute process; and
- 3| Offer a complete solution to your tax problems, including ex-CRA professionals and tax lawyers from Farber Tax Law.