CRA & Revenu Québec

Understanding Income Tax Return Reviews

The Canada Review Agency performs a number of annual reviews of individuals who file their income tax return. The purpose of these reviews is to promote awareness of income tax laws and ensure compliance. These reviews are an integral part of the Canadian tax system, as they help maintain the integrity and confidence in our tax system.

Selection for a Tax Review

Tax filing in Canada is based on self-assessment. Accordingly, it is your responsibility to complete your income tax return to report your income and claim applicable tax credits and deductions. By filing a tax return, you can determine the amount of tax owing and refunds that you may be entitled to.

The purpose of the review program is to highlight frequent areas of misunderstanding regarding the tax system. The CRA also uses this feedback from taxpayers to improve its forms and guides in future tax years.

How the CRA Determines Which Returns to Review

There are a number of ways the CRA determines which tax returns to review. These include random selection, comparing information submitted on your tax return with information on your tax slips, the types of tax credits and deductions claimed, and your tax review history.

Whether you file electronically or complete a paper return, the CRA selects tax returns in the same way for review. Therefore, your chances of being chosen for a review are the same regardless of your method of filing. The CRA focuses its review each year based on prior review results and areas where there have been problems in the past.

The majority of tax returns filed are processed in between two and six weeks. For most tax returns, a notice of assessment and applicable refund are issued without a review to speed up the tax filing process. In spite of this, all tax returns are reviewed through the CRA’s computer system and may be reviewed later on.

It’s a good idea to hold onto all your tax receipts and documents for any tax claims for a minimum of six years in the event that you are chosen for a review.

The Review Process

If the CRA would like to review your tax return, it will check your claim based on the information the agency already has on file. If further clarification or information is required, a CRA representative may contact you by phone or mail.

If your tax return is being reviewed under the CRA’s Processing Review program, you can send scanned documents through the CRA’s My Account online service.

It’s important to note that a tax review is not the same thing as an audit. While a tax review can be a review of single claim on your tax return, an audit is more intensive and can consist of a review of your entire income tax return.