Got a Letter From the CRA? What It Means and Exactly What to Do Next
Quick Answer: Most CRA letters are routine: requests for receipts, matching-program adjustments, or processing reviews. The worst response is to ignore them. Read the letter carefully, note the deadline, confirm it is genuine through CRA My Account or My Business Account, gather the requested documents, and respond in full and on time. If you disagree with a reassessment, you generally have 90 days to file a formal objection. For audits, collections, or complex reviews, getting professional representation early can make a real difference.
Few envelopes cause as much anxiety as one from the Canada Revenue Agency. But a CRA letter does not automatically mean you did something wrong. Many are standard verification requests sent to thousands of taxpayers each year. This guide explains the most common letters, what they mean, and how to respond.
First: Confirm It Is Genuine
Scams impersonating the CRA are common. Genuine CRA correspondence will generally be available in your CRA My Account or My Business Account. Warning signs of a scam include:
- Threats of arrest, deportation, or immediate police involvement
- Demands for payment by gift card, prepaid credit card, or cryptocurrency
- Urgent pressure to act within hours
- Requests for personal information by email or text message
- Links in text messages asking you to log in or claim a refund
If in doubt, do not use contact details from the message. Log in to your CRA account directly or call the CRA using numbers from the official Canada.ca website.
Common Types of CRA Letters
Notice of Assessment (NOA). Issued after your return is processed. It confirms your balance, refund, and important information such as RRSP deduction limits. Review it for differences from what you filed.
Notice of Reassessment. Issued when the CRA changes a previously assessed return, often following a review or a request you made. Check the explanation of changes closely.
Pre-assessment or processing review. The CRA asks for documents to support a claim, such as medical expenses, donations, childcare, or moving expenses, before or shortly after assessing your return.
Matching program letter. The CRA compares your return to information slips from employers, banks, and others. If income is missing, such as a T4 or T5, the CRA may propose or make an adjustment.
Request for information (business). Businesses may receive requests to support HST input tax credits, specific expenses, or payroll figures.
Audit letter. A formal examination of your books and records, which can be a desk audit (by correspondence) or a field audit (at your premises). Audits can cover income tax, HST, payroll, or a combination.
Collections notices. Letters about unpaid balances, which escalate if ignored and may lead to legal action such as garnishment of wages or bank accounts.
How to Respond: A Step-by-Step Approach
1. Don’t panic, and don’t ignore it. Missing a deadline can lead to claims being denied or adjustments being made without your input.
2. Identify exactly what is being asked. Note the tax year, the specific items under review, and the response deadline.
3. Gather supporting documents. Receipts, invoices, bank statements, contracts, logbooks, and anything else that supports the item being reviewed.
4. Respond completely and in an organized way. Clear, labelled documents matched to each item make a review faster and easier. You can usually upload documents through CRA My Account or My Business Account.
5. Ask for more time if you need it. If you cannot meet the deadline, contact the CRA before it passes to request an extension.
6. Keep copies of everything. Record what you sent and when.
7. Get help when stakes are higher. For audits, large adjustments, collections, or complex business issues, professional representation can help you present your position clearly and avoid unforced errors.
What If You Disagree?
If you disagree with an assessment or reassessment, you can file a Notice of Objection. For most individuals, the deadline is the later of 90 days from the date of the notice or one year after the filing due date of the return. For corporations and other taxpayers, it is generally 90 days from the date of the notice. The objection should clearly set out the facts and reasons for disagreement.
Objections go to the CRA’s Appeals Branch, which is separate from the auditors. If the objection is unsuccessful, further appeal to the Tax Court of Canada may be possible.
For simple errors, it may be faster to request an adjustment than to file a formal objection.
Taxpayer Relief
If penalties or interest arose because of circumstances beyond your control, such as serious illness, natural disaster, or CRA error, or if paying would cause genuine financial hardship, you may be able to request cancellation or waiver under the taxpayer relief provisions. Requests must generally be made within ten calendar years from the end of the year in question.
Your Rights as a Taxpayer
The Taxpayer Bill of Rights sets out how the CRA must treat you, including the right to be informed, to receive clear explanations, to have representation, and to file a formal dispute. You can authorize a representative to deal with the CRA on your behalf through CRA’s online authorization process.
How to Reduce the Chance of CRA Issues
- Keep organized records for at least six years
- Reconcile your books monthly
- Report all income, including side and platform income
- Support HST input tax credits with proper invoices
- Separate personal and business finances
- File and pay on time
- Respond promptly to every CRA request
How Solstice Partners Helps
Solstice Partners helps individuals and businesses across Toronto and the GTA respond to CRA reviews, requests for information, reassessments, and audits. With your authorization, we can communicate with the CRA on your behalf, organize and submit supporting documents, reconstruct records where needed, and help you understand your options, including objections and taxpayer relief.
Frequently Asked Questions
Does a CRA letter mean I’m being audited?
Not necessarily. Most letters are routine reviews or requests for supporting documents. A formal audit is a specific process and will be clearly identified.
What happens if I ignore a CRA letter?
The CRA may deny claims, reassess your return, or begin collections. Ignoring a letter rarely makes the issue go away.
How long do I have to object to a reassessment?
For most individuals, the later of 90 days from the notice date or one year after the return’s filing due date. For most other taxpayers, 90 days from the notice date.
Can someone deal with the CRA for me?
Yes. You can authorize a representative, such as an accounting firm, to communicate with the CRA on your behalf.
How do I know if a CRA call or message is a scam?
The CRA does not demand payment by gift card or cryptocurrency, or threaten arrest. Verify by logging in to your CRA account directly.
Can the CRA cancel penalties and interest?
In some cases, under taxpayer relief provisions, if the circumstances were beyond your control or paying would cause financial hardship.
Received a CRA letter? Contact Solstice Partners to talk through your options.
