After a taxpayer has filed a notice of objection, objecting to all or part of the reassessment made against him, the file is referred to a different officer working in the Appeals Division (the “appeals officer”). This officer will take a fresh look at the file. He will have access to the audit report, the correspondences between the auditor and the taxpayer, and the information contained in the Canada Revenue Agency database. Looking at the file in its entirety, he will decide whether or not he agrees with the reassessment made by the auditor and may:
- Vary the reassessment, meaning that he will change part of the reassessment. For example, if the auditor reassessed the taxpayer and disallowed $20,000 of business expenses, the appeals officer may vary the reassessment to allow an additional $5,000 to be deducted. While $5,000 of business expenses have been allowed, $15,000 of business expenses remain disallowed and thus the appeals officer will confirm part of the reassessment.
- Vacate the reassessment.
- Confirm the reassessment (in its entirety).
The appeals process generally ends with the appeals officer reassessing the taxpayer and/or issuing a notice of confirmation stating the issues that remain in dispute. This ends the administrative process. Either the taxpayer accepts the CRA’s position and pays the amount owing or, alternatively, he can take his case to the Tax Court of Canada.
Last updated: November 3, 2016