You just received a Notice of Reassessment from CRA. The auditor didn’t agree with your position. You owe money—maybe a lot of money. And you’re wondering: is it over? Did I lose?
The answer is no.
An audit loss is not the end. It’s just the auditor’s first shot. Now it’s your turn.
Here’s what most people don’t know: about 62% of objections filed in 2024–2025 were either fully won or settled in the taxpayer’s favour. That means you still have a real shot at reducing—or even eliminating—the reassessment.
In this guide, I’m breaking down the exact objection process: the deadlines you can’t miss, what happens to the money you owe while you’re fighting, and the three reasons you might still win.
What Is a CRA Objection?
A CRA objection is your formal right to challenge a Notice of Assessment or Reassessment. It’s an internal review process within CRA where a different team—called the Appeals Branch—reconsiders the auditor’s decision.
Here’s the key difference: the Appeals Branch has a different mandate than the auditors. Their job is to conduct a fair, complete, and impartial review—not to defend the auditor’s position.
That’s why objections can work, even after an audit loss.
The Objection Deadline You Can't Miss
If you want to file an objection, you need to act fast. Here are the deadlines:
For Corporations:
- 90 days from the date of the Notice of Reassessment.
For Individuals:
- The later of:
- 90 days from the Notice of Reassessment date, OR
- 1 year after your tax filing deadline for the return
But don’t count on that extra year. File as soon as you can.
What If You Miss the Deadline?
You can apply for an extension, but here’s the catch: you have to apply within 1 year of the original objection deadline. After that, it’s over.
CRA will consider your extension request if you have a valid reason—like you were trying to resolve things with the auditor, or there were circumstances beyond your control. But you need to act fast.
Missing the deadline is one of the most expensive mistakes you can make. Once that window closes, your only option is Tax Court—which is a different process, with higher costs and longer timelines.
What Happens to the Money You Owe While You're Fighting?
If you file an objection, CRA usually won’t force you to pay while the dispute is ongoing. They pause collections until 90 days after they decide on your objection.
But there are exceptions:
- If you owe payroll taxes or GST/HST that you were supposed to withhold and remit, CRA can still come after you.
- If CRA thinks you’re a flight risk, they can still pursue collections.
- If you’re a large corporation (meaning you and your related companies have over $10 million in taxable capital), you have to pay 50% of the disputed amount upfront. No exceptions.
Interest Keeps Running
Here’s the part most people miss: even if collections are paused, interest does NOT stop. It keeps piling up on the full amount you owe.
So if you lose the objection later, you’ll owe the tax plus all the interest that accumulated while you were fighting.
That’s why I tell clients: if you have the cash, consider paying anyway. It’s pure risk management.
Now, if you win the objection—fully or partially—CRA has to refund you. And here’s the good news: they refund you with interest. So you’re not leaving money on the table if you pay early.
How Long Do CRA Objections Actually Take?
CRA publishes their average processing times. Here are the real numbers from October 2025:
- Low complexity cases: 128 days (about 4 months)
- Medium complexity cases: 335 days (about 11 months)
- High complexity cases: 690+ days (nearly 2 years)
And here’s the reality: those are averages. CRA has a backlog. Most medium-complexity objections being assigned today were filed back in September 2024.
So expect months before anyone even picks up your file.
Part of the reason for this backlog is that CRA is doing more audits than ever. And not every auditor has the same level of experience. Sometimes things get missed. Sometimes the facts aren’t fully understood.
That’s where objections come in.
The 3 Possible Outcomes of a CRA Objection
Once CRA reviews your objection, they have three options:
1. Confirm
CRA sticks with the auditor. You lose.
2. Vacate
You win. CRA cancels the reassessment.
3. Vary
CRA meets you in the middle. Maybe the auditor reassessed you for $500,000, and Appeals settles at $250,000. It’s a partial win.
In my experience, “vary” is where a lot of real-world disputes end. Appeals has the authority to settle for a middle-ground number, and they often do—especially when the facts aren’t black and white.
That’s why I say Appeals is often more reasonable. Their mandate is to conduct a fair and impartial review, not to defend the auditor’s position.
Is It Worth Fighting? (Cost-Benefit Breakdown)
Not every issue is worth fighting. Just because you lost an audit doesn’t mean you should automatically file an objection on every single point.
There’s a cost. There’s time. There’s effort. There’s headache. There’s peace of mind.
You need to weigh the feasibility: is this even worth pursuing?
A good tax specialist will help you figure this out. They’ll let you know the lay of the land—what’s winnable, what’s not, and what the risks are.
Real Costs
Most objections can’t be done on a fixed fee. People charge based on time spent.
- Hourly rates: $250 to $500 per hour (standard range)
- Retainer: $5,000 to $10,000 upfront, depending on the issue
Once the objection goes out, when it comes back, there will be some back and forth. That might cost a bit more.
So if it’s a small ticket item—you lost a deduction worth $2,000 in taxes—maybe you let it go. It’s not worth the money.
But if it’s a huge issue—like CRA came back with $1 million of undeclared income and you feel like they’re completely out to lunch—then it’s worth fighting.
And if you feel strongly that you have legs to stand on, you go after it.
The 3 Reasons You Might Still Win
So why should you bother filing an objection? Because there are three reasons you might still win:
Reason 1: The Facts Were Wrong
Maybe the auditor didn’t have all the documents. Maybe they misunderstood the timeline. Or maybe you just didn’t explain it well.
At objection, you get a second chance to fix the factual record. You can submit new documents, clarify what happened, and explain the full story.
Example: I had a client who got reassessed because CRA reclassified their subcontractors as employees. The auditor looked at the contracts and said, “These people aren’t independent—you control them.” But at objection, we showed the full paper trail: separate invoices, proof they worked for other clients, their own business numbers. CRA backed off.
Why does this matter? Because if those workers are employees, the client owes payroll taxes, CPP, EI contributions—all retroactively. That’s tens of thousands of dollars. But if they’re contractors, none of that applies.
Reason 2: The Law Was Applied Incorrectly
Maybe the auditor took a rigid interpretation of a rule, or maybe they didn’t consider a key provision.
Appeals officers are often more experienced, and they have the authority to reinterpret the law. If the auditor got it wrong, Appeals can fix it.
Reason 3: The Relationship Broke Down
Sometimes the audit just goes sideways. Maybe the auditor didn’t believe your explanation. Maybe the relationship soured. Or maybe the auditor had a bias.
At objection, you get a fresh set of eyes. A different person. And that can make all the difference—especially when the evidence isn’t perfect and the outcome hinges on judgment.
Example: A client got reassessed because CRA thought they were deferring income improperly. The auditor didn’t understand how the industry worked—invoicing cycles, payment terms, industry norms. At objection, we walked the Appeals officer through how the business actually operates. They got it. CRA vacated the reassessment.
Your Action Plan: What to Do Now
Here’s what you need to do:
1. File a Comprehensive Objection
Don’t just say “I disagree.” Explain why.
Describe every issue you want Appeals to review. Specify the relief you want—quantify it. And provide the facts and reasons that support your position.
For large corporations, this is mandatory. But even if you’re not a large corp, you should do it anyway. Because if you don’t raise an issue now, you might lose the right to raise it later at Tax Court.
2. File Online
CRA has a portal—My Account for individuals, My Business Account for corporations. It’s faster, and you get confirmation that they received it.
3. Decide Whether to Pay
If you have the cash and the reassessment is big, paying can save you interest. If you can’t pay, that’s fine—collections are paused. Just know that interest is still running.
4. Expect a Long Wait
If you’re in the medium-complexity bucket—which most business owners are—you’re looking at about 11 months. So don’t hold your breath.
5. Get a Tax Specialist
If you handled the audit yourself and it didn’t go well, maybe it’s time to get someone professional.
Not every CPA is trained in complex audits. Just like how every doctor is not a heart surgeon.
Tax specialists—CPAs who focus on audits and objections—have their own training and experience. That’s why they do what they do.
A good specialist will help you figure out which battles to pick, what the costs are, and whether it’s worth it.
If you want the full checklist for surviving a CRA objection, you can download it here:
