Tax Court of Canada: Informal or General Procedure
The two tracks for appealing a CRA decision, the dollar limits that decide which you use, what a hearing involves, and the costs and timelines.
Reviewed by the Fairlight Accounting cross-border tax team — U.S. & Canadian Tax Desks
The Tax Court of Canada hears appeals from Canada Revenue Agency assessments after an objection is confirmed or left undecided for 90 days. Smaller disputes use the informal procedure — simplified rules, limited cost exposure, and the option to be represented by an agent. Larger disputes use the general procedure, with formal pleadings, discovery, and rules of evidence.
On this page
Which procedure applies?
| Feature | Informal procedure | General procedure |
|---|---|---|
| Limit | Federal tax and penalties in dispute of $25,000 or less per year, or losses of $50,000 or less (GST/HST: $50,000) | No limit |
| Deadline to appeal | 90 days after the confirmation or reassessment | 90 days |
| Filing fee | None | $250, $400, or $550, depending on the amount in dispute |
| Representation | Yourself, a lawyer, or an agent such as an accountant | Yourself or a lawyer (a corporation must use a lawyer unless the court grants leave) |
| Pre-trial process | Minimal; a hearing is scheduled | Pleadings, lists of documents, examinations for discovery |
| Rules of evidence | Relaxed | Formal |
| Costs | Can be awarded to a taxpayer who wins more than half; against the taxpayer only for undue delay | Loser may pay a portion of the winner's costs |
| Precedent | Judgments are not treated as precedent for any other case | Judgments can be cited as precedent |
A taxpayer whose dispute exceeds the informal limit can elect the informal procedure by giving up the excess.
How does an appeal proceed?
You file a notice of appeal stating the facts, the issues, and the relief sought. The Department of Justice files a reply for the Crown. Under the general procedure, the parties exchange documents and examine each other's witnesses before trial; under the informal procedure, the Crown's reply is due within 60 days and the court generally fixes a hearing date within 180 days after that. Most appeals settle before a hearing — the Justice lawyer has authority to settle on a principled basis.
Who has the burden of proof?
The taxpayer must show, on a balance of probabilities, that the CRA's assumptions are wrong. The exception is gross negligence penalties and reassessments beyond the normal period, where the CRA carries the burden.
What happens after the decision?
Either side may appeal a general procedure judgment to the Federal Court of Appeal within 30 days, not counting days in July and August. Informal procedure judgments can also be appealed to the Federal Court of Appeal within the same period, but only on limited grounds such as an error of law, acting without jurisdiction, or a breach of procedural fairness.
Frequently asked questions
Do I have to pay the tax before appealing?
For income tax, generally no; collection of the disputed amount stays suspended until the court sends its decision, although a large corporation can be required to pay half. GST/HST and source deductions are not suspended.
Can I appeal directly without objecting first?
No. An objection is a prerequisite, but you need not wait for the result: if the CRA has not decided an income tax objection within 90 days (180 days for GST/HST), you can appeal.
How long does an informal appeal take?
The statute sets the pace: the Crown's reply is due within 60 days, the hearing is generally fixed within 180 days after that, and judgment is due within 90 days after the hearing ends, so many informal appeals finish within about a year.
Can a U.S. resident appeal a Canadian assessment?
Yes. Hearings can be by videoconference, and an agent or counsel in Canada can appear.
Official sources
The Tax Court of Canada explains: “For income tax appeals, the Informal Procedure is limited to cases in which the amount of federal tax and penalties in dispute for each taxation year, excluding interest, is $25,000 or less and to cases in which the amount of loss in question is $50,000 or less.” — Tax Court of Canada, Get Started, https://www.tcc-cci.ca/en/pages/get-started
The CRA explains: “Individuals can either represent themselves or have a lawyer represent them. A lawyer has to represent a corporation, except with leave of the Court and on any conditions that it may determine.” — Canada Revenue Agency, Appealing income tax assessments to the Tax Court of Canada, https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4443-2/appealing-income-tax-assessments-tax-court-canada.html
Next step
Fairlight Accounting handles U.S. domestic, cross-border (U.S.–Canada), and international tax returns, plus bookkeeping, payroll, and CFO advisory. Our Canadian Tax Desk prepares the record for appeal and works with counsel where the general procedure requires it. See pricing or book a free fit call.
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