When it comes to taxes, deadlines are to be taken seriously
While most of us are aware of the April 30 tax filing deadline for personal returns (self-employed taxpayers and their spouse or partner have till June 30), there are some other deadlines which are critically important and, if missed, can lead to punitive results as a recent tax case demonstrates.
To object to an assessment, you must file, in writing, a formal Notice of Objection, clearly setting out the reasons you're objecting.
The filing deadline for submitting such an objection is one year from your normal filing due date (generally April 30) or 90 days after the date printed on the Notice of (Re)Assessment, whichever is later.
What if you miss your deadline for objecting? All is not lost as you can still apply to the CRA for an extension of time to object to an assessment.
Such an application must set out the reasons why the notice of objection was not made before the deadline. In addition, you must demonstrate that you were unable to object or to have someone else object for you or demonstrate that you had a "bona fide intention to object."
But this extension itself has a deadline and must be applied for within one year from the expiry of the normal deadline for filing your notice of objection. If the CRA denies your application, you further appeal to the Tax Court to have the application granted but you must do so within 90 days of the CRA's refusal letter.
The recent case involved a taxpayer who participated in the "Global Learning Donation Program" tax shelter and the tax issue under dispute was whether or not her donation was valid. She was reassessed numerous times for various tax years but the case involved her application for a court order to extend the time to file an objection for a Notice of Reassessment she received on April 7, 2011 for the 2008 tax year.
The taxpayer filed an objection on April 21, 2012 but it was not accepted because it was beyond the 90 day deadline of July 6, 2011 to file an objection. The CRA, however, did advise her that she could apply for an extension of time and that the deadline for doing so was July 6, 2012.
She filed another objection on November 30, 2012 which was also denied since it was beyond the time limit. The CRA informed her at this time that she was "out of time to apply for an extension."
In March 2013, she applied to the Tax Court for an extension of time to file a notice of objection arguing that "she did the best she could to comply with the law."
The judge felt sympathetic to the taxpayer and acknowledged that the rules surrounding objections are "complex" and that "taxpayers and their advisors sometimes fail to navigate (them) properly." Nevertheless, the judge denied the taxpayer's application, saying, "The legislative requirements are strict and relief cannot be granted on the basis of fairness alone."