In Canada, we have a self-assessing tax system. This means it is up to you to:
- report your income
- claim the deductions and tax credits you are entitled to.
You calculate whether you owe tax or receive a refund.
To keep people honest and maintain the integrity of the Canadian tax system, the Canada Revenue Agency (CRA) may review your return. These reviews remind Canadians of the tax laws and encourage people to follow them. When your return is chosen for review, this is not a tax audit. Learn more now
Why does the CRA choose to review certain returns?
All returns are electronically analyzed and processed. This allows the CRA to send out notices of assessment as quickly as possible - in most cases, within just two to six weeks.
Many returns are selected at random for review. But there may be a specific reason why the CRA chooses to review your tax return:
- The information on your return does not match information from third-party information sources, such as T4 slips from your employer.
- The types of deductions or credits you claimed and your history with the CRA raises a red flag. For example, if your return was reviewed in a previous year and it led to an adjustment made to a claim, then the CRA may review your return again.
Remember: A tax review is not a tax audit. It's simply a way the CRA makes sure our tax system is working the way it is meant to work. Content in this section is provided in partnership with the Investor Education Fund, a non-profit organization promoting financial literacy to Canadians. To find out more go to GetSmarterAboutMoney.ca.