TAX OBJECTION DECISIONS TAKING LONGER
POST COVID, CRA APPEALS BRANCH SLAMMED WITH NEW WORK!
The Canada Revenue Agency (CRA) recently released its 2025-26 Departmental Plan (“the Report”), outlining its priorities and recent performance. It reveals a critical piece of information that should serve as a warning for all taxpayers: the CRA is being overwhelmed by Notices of Objections (“NoOs”) and is struggling to keep up.
As we report on below, large businesses with complex tax issues are likely to suffer the most.
The "Capacity" Crisis
Buried in the performance tables of the Report is a stark admission: the CRA has significantly missed its own targets for resolving objections in a timely manner. Both high and low complexity objections are vastly exceeding duration targets, and wait times for both exceeded those from last year. Meanwhile, high complexity GST/HST objections continue to be some of the most complicated, and most time consuming, objections.
Why the delay? The answer is found in the Report’s fine print. The footnotes reveal that the objections program was "impacted by an increase in objection requests which outpaced the program's capacity," directly increasing wait times.
Recent reporting by The Globe and Mail reveals the specific numbers: in 2018-2019, the CRA received 68,000 objections. By 2024-2025, that number had grown to 128,000. (!)
Implications for Taxpayers
The CRA is acknowledging that taxpayers are disputing assessments in higher numbers than anticipated, and its Appeals Division is clogged. This creates a "justice delayed" scenario for Canadian businesses that assert their rights and object.
When the system is backed up, files sit in a queue. While the Report claims that the CRA is "temporarily increasing its resources" to address this, it also mentions that the CRA is currently facing a period of "fiscal restraint". Presumably, wait times will not be dramatically lower any time soon.
Strategic Considerations
Large businesses wishing to successfully challenge tax assessments, and to minimize their wait times when objecting, should involve Tax Counsel early. Doing so has many benefits.
First, involving Tax Counsel early—ideally, during the Audit stage—will better allow businesses to understand the Auditor’s view that led to the reassessment and allows for the formulation of an effective, informed NoO. Additionally, completeness is paramount when it comes to effective NoOs. Tax Counsel can assist in assembling a complete NoO backed by compelling evidence, so that it has a better chance of success, on the one hand, and will likely be decided more quickly, on the other. In a backlog, after all, incomplete files often get pushed to the bottom of the pile or simply denied, because the gaps and/or flaws in their evidence provide an overworked Appeals Officer reason to delay or deny the NoO.
Wait times for taxpayer Objections are going up.
Experienced Tax Counsel, involved early in the Audit process, can help maximize the chances of success.
Takeaways
The CRA’s own data shows that the objection system is under strain. More taxpayers are objecting every year, and the CRA has not kept up by proportionally enlarging its Appeals Division.
This should not discourage businesses from challenging incorrect assessments. As we recently wrote , the success rates for objections remain high. The key is patience and professional preparation. Experienced Counsel, involved early in the Audit process, can help maximize the chances of success.
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