Taxation law

Notice of Assessment Not Received: Recent Developments

May 7th, 2019

By Jonathan Éthier

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The importance of respecting the various time limits imposed on taxpayers in exercising their right to contest cannot be overstated.

At the provincial level, a taxpayer may object to an assessment by filing a written notice of objection within 90 days of the date a notice of assessment is sent. A similar rule applies at the federal level, whether in terms of income tax or GST[1]. After this period has expired, a request for an extension of the time limit for filing an objection must be submitted to the tax authorities. Such a request could be refused depending on the circumstances, hence the importance of objecting within the 90-day period.

Section 87 of the Tax Administration Act[2] ("TAA") provides that the date of sending a notice of assessment is presumed to be the date indicated on the notice. At the federal level, the rule is essentially the same for GST[3] and income tax, the date of sending a notice of assessment is presumed to be the date on which the notice was mailed (or sent electronically)[4].

If a taxpayer has not received his notice of assessment from the provincial government, he may apply to the Court of Québec for a judge to order the Minister to provide him with a certified copy of the notice of assessment. In such cases, the court must be satisfied by preponderant evidence that the notice of assessment has not been received and that the taxpayer is suffering otherwise irreparable prejudice. The advantage of such a request is that the taxpayer will then be able to file his objection. Indeed, the 90-day period will begin to run on the date of notification of the notice of assessment following the court order.

At the federal level, to the extent that the Minister can prove that the notice of assessment has been sent (for GST) or mailed (for income taxes), it will be presumed that its sending or mailing, as the case may be, took place on the date set out on the notice[5]. To overcome this presumption, a taxpayer will not necessarily be able to rely on the fact that he or she has not received a notice of assessment or benefit from a similar remedy at the provincial level in such circumstances. Indeed, the Minister has an irrebuttable presumption that any first-class mail (or equivalent) is deemed to have been received by a taxpayer on the date of mailing[6].

Recent case law: the Trottier and Kirschke cases

The Trottier c. Agence du revenu du Québec[7] case provides some relevant information in provincial law with respect to the non-receipt of a notice of assessment. In this case, a taxpayer was asking the Court of Québec to order Revenu Québec to notify her a notice of assessment[8].  The Court had to assess whether or not a notice of assessment had been received by the taxpayer.

Ultimately, the Court ruled in favor of the taxpayer, even though the notice of assessment issued in November 2015 had been sent to the address designated in her 2015 tax return. The taxpayer had nevertheless managed to show that she was not in Canada when Revenu Québec issued the notice of assessment, that she did not have a residence in Québec and that she did not receive the said notice. It appears that at the time of the issuance of the notice of assessment, the taxpayer had left for Italy and that the notice of assessment had been sent to her former home where her mother resided.

The Court did not fail to recall that section 87 TAA establishes a presumption as to the date of sending an assessment and not a presumption of its receipt (as found at the federal level). In addition, the judge pointed out that in the context of such a request to the Minister to notify a certified copy of the notice of assessment to a taxpayer, there will be no need to demonstrate that it was impossible in fact for that person to act. This requirement concerns rather request for an extension of the time limit for filing an objection.

The case Kirschke v. The Queen[9] also concerns unreceived assessments. In this case, a taxpayer requested an extension of time to serve a notice of objection to various notices of assessment alleging that she had never received the notices. Therefore, they would have never been sent.

The evidence showed that the notices of assessment had been sent to an old address of the taxpayer although she had previously notified the Canada Revenue Agency (the "CRA") of her change of address. The Court held that in order for the irrebuttable presumption of receipt of a notice of assessment to apply (at the federal level), the address used by the CRA must be the correct one. The presumption could not apply.

Ultimately, the Tax Court of Canada dismissed the application and concluded that the taxpayer had duly objected to her notices of assessment within the 90-day period. Indeed, the notices could have been "sent" when she first became aware of the said assessments during a telephone call with the CRA just a little less than two years after they were issued.

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Now, with the My Account-type online services offered by both the CRA and Revenu Québec, it has become easy to verify whether notices of assessment are issued. Using those services could avoid the hassle of a court battle to obtain a copy of a notice of assessment or a debate relating to a request for an extension of the time limit for filing an objection.

 

[1] Cf. subsection 165(1) of the Income Tax Act, R.S.C. 1985, c.1 (5th Supp.) ("ITA"); subsection 301(1.1) of the Excise Tax Act, R.S.C. 1985, c. E-15 ("ETA").

[2] Tax Administration Act, R.S.Q., c. A-6.002 ("TAA").

[3] Cf. subsection 335(10) ETA.

[4] Cf. subsection 244(14) ITA.

[5] Cf. Boroumend v. The Queen, 2016 TCC 256, para. 3. (appeal dismissed: Boroumend v. Canada, 2017 FCA 245) ; DaSilva v. The Queen, 2018 TCC 74, para. 4.

[6] Cf. subsection 248(7) ITA and 334(1) ETA.

[7] Trottier c. Agence du revenu du Québec, 2019 QCCQ 1167.

[8] Cf. section 87 TAA.

[9] Kirschke v. The Queen, 2019 TCC 68.

 

 

This publication is of a general nature, is as of the date indicated and is not intended to constitute an opinion or legal advice. The facts and circumstances of your particular situation should be specifically identified and addressed before appropriate legal advice may be given.