The informal procedure in Canadian tax court is a process that allows taxpayers to resolve their disputes with the CRA without having to go through a formal trial. However, taxpayers who want to appeal their case to the tax court must file a Notice of Objection with the CRA.
A Notice of Objection is a formal way to request a review of your tax assessment by the Canadian Revenue Agency (CRA). This document must be filed within 90 days of receiving your assessment notice and will outline the specific grounds on which you are objecting to the CRA’s assessment.
The informal procedure is a less formal way to have your case heard by the tax court. It is designed for cases that are not very complex and do not require much evidence. The informal procedure can be used for cases where the dollar amount in dispute is;
- $25,000 or less of income taxes.
- $50,000 of a denied income tax loss.
- $50,000 of GST/HST in dispute.
Once your appeal is filed, the tax court will give you a date for a conference. At the conference, you and the CRA will discuss your case and try to reach an agreement. Then, the tax court will make an order based on the agreement. If you do not reach an agreement, the tax court will set a date for a hearing.
There are four steps in the informal procedure:
1. The taxpayer files a Notice of Objection appeal with the tax court.
2. The CRA responds to the notice of appeal and provides its evidence to the court.
3. The taxpayer presents their evidence to the court.
4. The judge makes a decision based on the evidence presented by both parties. The judge will then make a decision.
The informal procedure is usually quicker and less expensive than the formal procedure. However, it can take longer if your case is complex or you and the CRA cannot agree on a solution. If you are still dissatisfied with the outcome, you can proceed to the formal tax court process.