Got a CRA Notice of Assessment? Here is What to Do Next

What Is a Notice of Assessment (NOA)?

The NOA is the CRA's official confirmation that it has processed your tax return. It summarizes your total income, deductions, tax payable, and the result: either a refund amount (which triggers a direct deposit or cheque) or a balance owing (which must be paid immediately to avoid interest). The NOA also tells you your RRSP deduction limit for the next year and any loss carry-forward balances.

Types of CRA Notices

• Notice of Assessment (NOA) — Standard after processing your T1 or T2 return
• Notice of Reassessment — CRA changed something on your original return (could be in your favour or against)
• Requirement to File — CRA did not receive your return; you must file within a deadline or face a penalty
• Request for Information — CRA wants documentation to verify a claim you made
• Formal Demand to File — Escalated version of "Requirement to File"; carries higher penalties
• Intent to Audit Letter — CRA is initiating a detailed review of your records
• T1 Matching Program Letter — CRA matched slips from employers/banks against what you reported

The NOA: What Each Line Means

Your NOA summarizes these key figures:

• Total Income — Sum of all reported income sources
• Net Income — After deductions like RRSP, moving expenses, union dues
• Taxable Income — Net income minus additional deductions
• Total Payable — Your tax owing before credits
• Net Federal Tax — After applying your non-refundable credits
• Total Credits — Payments already made (tax withheld from payroll, instalments)
• Refund or Balance Owing — The final result
• RRSP/PRPP Deduction Limit — How much you can contribute next year

CRA Made a Change — What Now?

If your reassessment shows different numbers than your filed return, the CRA includes an explanation of changes. Common adjustments include: correcting arithmetic errors, adding income from employer slips the CRA received but you omitted, disallowing a deduction you claimed without proper support, and applying credits to accounts.

You have 90 days from the date on the NOA to file a formal Notice of Objection if you disagree. Miss that window and you need to apply for an extension, which the CRA grants at its discretion.

How to File a Notice of Objection

• Step 1: Review the changes the CRA made and gather documentation to support your position
• Step 2: File your objection online via CRA My Account, or by mail using form T400A
• Step 3: Clearly state each issue you are contesting and provide supporting documents
• Step 4: The CRA's Appeals Division reviews your objection (can take 6–18 months)
• Step 5: If your objection is denied, you may appeal to the Tax Court of Canada within 90 days

Got an Audit Letter? Do Not Panic.

An audit letter does not mean you did anything wrong. The CRA audits returns randomly, and also targets certain industries and claim types (home office, vehicle expenses, charitable donations) more frequently. Respond to all audit requests promptly and with organized documentation. Do not ignore CRA correspondence — it only leads to escalation.

What to Do If You Get a Balance Owing

Pay as soon as possible via online banking, CRA My Payment, or by cheque. The CRA charges compound daily interest on balances owing at the prescribed rate (currently approximately 8% annually). If you cannot pay the full amount, contact the CRA to arrange a payment plan. Making partial payments stops interest from accruing on the paid portion.