CRA Notice of Reassessment: What It Means and What to Do
Receiving a Notice of Reassessment from the Canada Revenue Agency can be unsettling, but it does not necessarily mean you did something wrong. A reassessment simply means the CRA has reviewed your previously filed tax return and changed one or more amounts, which may affect your balance owing, refund, credits, or deductions.
Understanding why the reassessment was issued, reviewing the CRA’s changes carefully, and knowing your response options are essential to protecting your tax position and avoiding unnecessary penalties or interest.
What the Document Means
A CRA Notice of Reassessment replaces the earlier tax assessment for the tax year shown. It tells you what changed, why the CRA changed it, and whether you now owe tax or receive money back.
Reasons the CRA May Reassess
The CRA may reassess your return after receiving new information or reviewing an amount you reported. A reassessment does not always mean you made an intentional error.
Common reasons include:
- A T4, T5, T3, or other tax slip does not match your return
- The CRA denied a deduction or credit because it did not receive enough proof
- You requested a change to your return through an adjustment
- A review or audit changed reported income, expenses, capital gains, or credits
- The CRA corrected RRSP contribution room or benefit amounts
The CRA can reassess months or years after it first assessed your return. CRA notices of assessment and reassessment explain that a reassessment is issued only after the CRA makes changes to an earlier assessment.
Read the reason for the change carefully and compare it with your tax return, slips, receipts, and prior notice. You may agree with part of the reassessment and disagree with another part.
Information Shown on the Assessment
Your notice identifies the tax year, the date the CRA issued the reassessment, and the amounts it recalculated. It usually shows the old amount, the change, and the new total.
| Part of the notice | What you should check |
|---|---|
| Explanation of changes | Which income, deduction, credit, or other amount the CRA adjusted |
| Balance owing or refund | The amount due or payable after the new calculation |
| Interest and penalties | Whether the CRA added charges and the period they cover |
| Payment due date | When you must pay to limit more interest |
| RRSP information | Your updated contribution room, if applicable |
If you disagree, you generally have 90 days from the date on the notice to file a formal objection. A CRA Notice of Reassessment and objection deadline can help you identify the time limit, but use the date printed on your own notice.
Deadlines and Reassessment Periods
The CRA must usually reassess you within a set period, but the period depends on your taxpayer type and the issue involved. You generally have 90 days from the date on a notice of reassessment to object.
Normal Reassessment Periods
For most individuals, the normal reassessment period ends three years after the CRA mails your original notice of assessment. This period usually applies even if you later receive a notice of reassessment.
For corporations, the timing differs:
| Taxpayer type | Normal reassessment period |
|---|---|
| Individual or testamentary trust | 3 years |
| Canadian-controlled private corporation (CCPC) | 3 years |
| Other corporations | 4 years |
The CRA can review your return, ask for records, and issue a reassessment during this period. A reassessment can increase tax, reduce a refund, deny a credit, or add interest and penalties.
You should check the date of your original assessment, not only the date of the reassessment you received. The CRA explains the T2 corporation reassessment time limits for corporate returns.
Extended Reassessment Periods
The CRA may receive extra time when your return includes certain cross-border or disclosure-related issues. For many cases, it can extend the normal period by three more years.
This extension can apply if you reported, or should have reported, income from a non-resident or a transaction with a non-arm’s-length non-resident. It may also apply to transactions involving foreign property, foreign affiliates, or certain tax shelters.
Some reportable, notifiable, or avoidance transactions have separate disclosure rules. Missing a required disclosure can delay the start of the reassessment clock for that transaction.
An extended period does not mean the CRA can change every part of your return without limits. The reassessment must relate to the issue that allows the extension, unless another rule also applies.
If you disagree with the reassessment, file a Notice of Objection by the deadline. The CRA’s notice of assessment and reassessment guidance explains what these notices show.
Limitation Period Exceptions
The CRA can reassess at any time if it believes your return contains a misrepresentation caused by neglect, carelessness, wilful default, or fraud. This rule can apply even after the normal or extended period ends.
A simple mistake does not always prove carelessness. However, you should keep records that support your income, deductions, credits, and reported transactions. Clear records can help you respond if the CRA questions an older return.
You can also sign a waiver that gives the CRA more time to reassess a specific issue. A waiver must be made before the normal period expires, and you can generally revoke it by giving written notice. The CRA then usually has six months to reassess the matter covered by the waiver.
Certain adjustments, such as a loss carryback from a later tax year, may also allow the CRA to reassess an earlier year after the usual deadline.
Reviewing Changes to Your Return
Read the reassessment beside your earlier notice of assessment and your filed return. Check each changed line, keep records that support your claim, and confirm any interest or penalty added to your balance.
Comparing the Revised Amounts
Your Notice of Reassessment shows CRA’s new calculation after it changed your return. Compare it with your original Notice of Assessment, not only with the refund or balance shown at the bottom.
Focus on the reassessment summary and the explanation of changes. Check whether CRA changed your income, deductions, non-refundable credits, refundable credits, instalments, or tax already paid.
| Item to compare | What to check |
|---|---|
| Taxable income | Whether CRA added income or denied a deduction |
| Credits | Whether CRA changed an amount or found you ineligible |
| Tax withheld and instalments | Whether all payments appear correctly |
| Balance owing or refund | Whether it follows from the revised calculations |
A reassessment replaces the earlier assessment for that tax year. CRA generally sends a reassessment notice only after it makes changes to an assessed return, as explained in its notice of assessment and reassessment guidance.
Checking Supporting Documents
Match each CRA change to your records before you respond. For example, if CRA denied a medical expense, confirm the receipt shows the provider, date, amount paid, and eligible service.
Keep copies of documents such as T4 slips, T5 slips, tuition forms, donation receipts, childcare receipts, expense logs, and proof of payment. If you claimed employment or business expenses, compare each amount with your invoices, mileage record, and supporting statements.
Do not send records CRA did not request unless they directly support the disputed item. Submit clear copies and keep the originals.
If you find an error in your own return, wait until you receive the assessment or reassessment before requesting a change. CRA explains the process for changing a personal income tax return.
Understanding Interest and Penalties
CRA may add interest when you owe tax after the payment deadline. Interest can also apply if CRA reduces a credit or refund you received earlier. The notice should show interest separately from the revised tax amount.
Review the dates and amounts used in the calculation. Interest normally continues to build until you pay the outstanding balance, so paying the undisputed amount promptly can limit further charges.
A penalty is different from interest. CRA may apply a penalty for reasons such as filing late, repeatedly failing to report income, or making a false statement. Check the notice for the stated reason and the penalty amount.
If you disagree with a reassessment, you can file a Notice of Objection. In most cases, the deadline is 90 days from the date on the notice.
Responding to an Incorrect Assessment
Check the notice against your filed return, receipts, and CRA account records. You can ask CRA to correct a clear error, formally object to a disputed reassessment, and send records that support your position.
Requesting an Adjustment
Use an adjustment request when you agree with the reassessment in principle but CRA missed information or made a clear calculation error. For example, CRA may have omitted an RRSP contribution slip, medical expense receipt, or tuition amount that you already have.
You can request a change through CRA My Account, by using tax software with ReFILE, or by mailing Form T1-ADJ for an individual return. Corporations can generally request changes through CRA’s online services or by sending a written request.
Include the tax year, the line numbers you want changed, the revised amounts, and copies of supporting records. Keep proof that you sent the request.
An adjustment request does not protect your objection deadline. If you disagree with the reassessment and the deadline is close, file a formal objection instead of waiting for CRA to process an adjustment.
Filing a Notice of Objection
File a Notice of Objection when you believe CRA applied the law incorrectly, denied a valid claim, or reassessed you using facts you dispute. For most individuals, you must file it by the later of 90 days after CRA mailed the notice and one year after the return’s filing due date. Corporations generally have 90 days from the notice date.
Use Form T400A, file through CRA’s online services where available, or send a signed written objection. CRA explains its process and Income Tax Act objection deadlines.
State the exact reassessment you challenge and identify each disputed amount. Explain why you disagree, using facts rather than broad statements.
- Tax year: 2025
- Disputed item: Denied employment expenses
- CRA adjustment: $3,200 denied
- Your position: Expenses were required by your employment and supported by receipts and Form T2200
CRA Appeals will review the objection and may contact you or your authorized representative to discuss the issue. The CRA dispute review process can involve requests for more records or settlement discussions.
Providing Additional Evidence
Send evidence that directly proves the item CRA changed. Match each document to a specific part of the reassessment, and label files clearly with your name, tax year, and reference number.
For income issues, provide T4 slips, invoices, bank deposits, contracts, and accounting records. For deductions or credits, provide receipts, cancelled cheques, invoices, mileage logs, medical statements, and letters that show eligibility.
Do not send original documents unless CRA asks for them. Keep complete copies of everything you submit, including upload confirmations, courier tracking, and letters.
Add a short document list so the reviewer can follow your records:
| Evidence | What it supports |
|---|---|
| Employer letter and Form T2200 | Required employment expenses |
| Dated mileage log | Business kilometres claimed |
| Receipts and payment records | Amounts paid and claimed |
If a record is unavailable, explain why and provide reliable replacement evidence, such as bank statements or a signed letter from the payer.
Payment Options and Collection Actions
A reassessment can create a balance that needs prompt attention, even if you plan to challenge it. Paying, arranging payments, and filing an objection affect different parts of the process.
When Payment Is Due
Check the amount owing and payment due date on your Notice of Reassessment. If the CRA reassessed an earlier return, interest may already apply because interest is based on the original tax due date, not the date you receive the reassessment.
Pay the full balance by the stated due date if you can. The CRA charges daily compound interest on overdue income tax amounts, so waiting increases the debt.
You can pay through online banking, the CRA’s My Payment service, or other CRA-approved methods. Keep your confirmation number or receipt.
For many income tax debts, the notice of assessment or reassessment can serve as the CRA’s legal warning before collection action. Review the CRA’s rules on a legal warning for tax debt collection if you have missed the deadline.
Payment Arrangements
If you cannot pay in full, contact the CRA before the account moves further into collections. You may be able to make a payment arrangement based on what you can realistically pay each month.
Be ready to explain your income, living costs, assets, debts, and proposed payment amount. The CRA may ask for financial details before accepting an arrangement.
A payment arrangement does not remove the tax debt or stop interest from adding to the unpaid balance. Make every agreed payment on time. If your financial situation changes, contact the CRA right away instead of missing a payment.
Do not ignore CRA calls or letters.
Collections During a Dispute
You can object to a reassessment if you disagree with it, but you should still deal with the payment issue. For an individual income tax reassessment, you generally must file a notice of objection within 90 days from the date on the notice.
The CRA normally holds off on legal collection of the disputed income tax amount while it reviews a valid objection. This protection does not always apply to amounts you did not dispute, and interest can continue to grow.
Collections rules differ for GST/HST and payroll deductions. The CRA may collect those debts during a dispute because these amounts often involve money collected or withheld for the government.
If the CRA starts collection, it may apply tax refunds to your debt, require a bank to send funds to the CRA, or require an employer to redirect part of your pay. File your objection on time, keep proof of filing, and clearly identify the amount you dispute.
Professional Help and Record-Keeping
A tax professional can help you check whether the reassessment matches your return and supporting records. Keeping complete documents also makes it easier to respond to the CRA and support your position.
When to Consult a Tax Professional
Consult a CPA or tax lawyer when the reassessment changes a large tax balance, denies significant deductions or credits, or relates to business income, rental property, foreign assets, investments, or several tax years.
Get help quickly if you disagree with the change. You generally have 90 days from the date on the notice to file a Notice of Objection. Review the CRA’s notice of assessment and reassessment process before deciding how to respond.
A professional can compare the notice with your filed return, CRA letters, and proof of income or expenses. They can also prepare an adjustment request or objection and explain the tax, interest, and penalty amounts.
Bring copies of:
- Your notice of reassessment and any CRA review letters
- The tax return for each affected year
- Receipts, invoices, slips, and bank records tied to the disputed amount
- Notes of calls or messages with the CRA
Documents to Retain
Keep records that support every amount on your tax return. For personal returns, this includes T4s, T5s, RRSP slips, medical receipts, donation receipts, childcare invoices, tuition forms, and documents for property sales.
For a business, retain sales invoices, expense receipts, payroll records, bank statements, GST/HST records, contracts, and accounting files. Clear records help show how you calculated income and claimed expenses.
The CRA generally expects you to keep tax records for six years from the end of the relevant tax year. Keep records longer when you own property, report capital gains, carry forward losses, or have an unresolved objection or appeal.
Use labelled digital folders and keep readable copies of paper receipts. Record the date, amount, supplier, business purpose, and payment method for each business expense.
The Bottom Line
A CRA Notice of Reassessment should never be ignored, especially if it results in additional tax owing or you believe the CRA’s changes are incorrect. Depending on the circumstances, you may need to provide supporting documentation, request an adjustment, or file a formal objection within the applicable deadline.
JKC Group helps individuals and businesses review reassessments, respond to CRA concerns, and determine the best course of action. Book a consultation with our team for clear, professional guidance on your Notice of Reassessment.