CRA Remission Order Lawyers
Seeking extraordinary relief from tax, penalties, interest or other CRA debt? Our tax lawyers assess and prepare remission requests in exceptional circumstances.
Seeking Extraordinary Relief From a CRA Tax Debt?
In exceptional circumstances, a taxpayer may be able to request remission of federal tax, penalties, interest, or certain other amounts administered by the Canada Revenue Agency (CRA).
A remission order is an extraordinary discretionary remedy available where collection of an amount would be unreasonable or unjust, or where remission would otherwise be in the public interest.
Unlike ordinary taxpayer relief, which generally applies only to eligible penalties and interest, remission can potentially provide full or partial relief from the underlying tax itself.
Remission is not a routine tax dispute mechanism. It is generally considered only after other available remedies have been pursued or are no longer available.
At KR Law Firm, our tax lawyers assess potential remission cases, prepare detailed submissions and supporting evidence, communicate with the CRA during the review process, and advise clients on available recourse where a request is denied.
What Is a CRA Remission Order?
Section 23 of the Financial Administration Act permits the Governor in Council, on the recommendation of the appropriate Minister, to remit all or part of certain taxes, penalties, and related interest where collection or enforcement would be unreasonable or unjust, or where remission is otherwise justified in the public interest.
A remission order may be:
- Full or partial;
- Conditional or unconditional;
- Granted before or after an amount has been paid; and
- Applied to qualifying tax, penalties, interest, or other eligible debt.
Remission is different from a reassessment. If remission is granted, the CRA applies the authorized credit to the taxpayer’s account rather than changing the underlying assessment.
Who Actually Grants a Remission Order?
The CRA administers and reviews remission requests, but it does not have the legal authority to issue a remission order itself.
If the CRA concludes that remission may be supported, the request can be referred to the Minister of National Revenue.
The Minister may then recommend remission to the Governor in Council.
Only the Governor in Council can issue a remission order under section 23 of the Financial Administration Act.
This distinction is important because remission is not simply a discretionary settlement offered by a CRA officer.
Remission Is a Remedy of Last Resort
The CRA describes remission as a rare and extraordinary measure.
Generally, a taxpayer must first pursue other remedies that are reasonably available.
Depending on the situation, these may include:
- Correcting or adjusting a tax return;
- Filing a Notice of Objection;
- Appealing to the Tax Court of Canada;
- Requesting penalty and interest relief;
- Making a Voluntary Disclosures Program application;
- Arranging payment of an outstanding tax debt; or
- Pursuing another remedy available under the applicable tax legislation.
Remission generally cannot be used simply to reopen a tax dispute after a taxpayer missed an objection or appeal deadline or was unsuccessful in an audit, objection, settlement, or court proceeding.
What Amounts Can Potentially Be Remitted?
Depending on the applicable legislation and circumstances, remission may potentially provide full or partial relief from amounts such as:
- Federal income tax;
- GST/HST;
- Excise tax or excise duties;
- Penalties;
- Interest;
- Certain Canada Pension Plan or Employment Insurance amounts;
- Certain benefit-related debts; and
- Other qualifying debts administered by the CRA.
The availability of remission depends on the particular debt, the legislation under which it arose, and the taxpayer’s circumstances.
When May the CRA Consider a Remission Request?
CRA guidelines identify several categories of circumstances in which remission may potentially be considered.
The guidelines are not exhaustive, and each case is assessed individually.
Extreme Financial Hardship
The CRA may consider remission where a taxpayer’s current and anticipated resources are insufficient to pay the amount owing while still meeting the basic necessities of life.
This is a high threshold.
CRA may examine matters such as:
- Current income and expenses;
- Assets and liabilities;
- Ability to borrow or rearrange finances;
- Family income;
- Age and health;
- Future earning capacity; and
- The effect that paying the tax debt would have on basic living needs.
The taxpayer generally must demonstrate that reasonable resources are not available to satisfy the debt.
Financial Setback With an Extenuating Factor
A taxpayer may also request remission where payment would create a significant financial setback and an extraordinary factor beyond the taxpayer’s control contributed directly to the debt.
For example, relevant circumstances may involve a serious illness or other event that impaired the taxpayer’s ability to manage their tax affairs.
The connection between the extenuating circumstance and the tax debt should be supported by evidence.
CRA Error
Remission may potentially be considered where incorrect actions or information provided by the CRA caused the taxpayer to become liable for an amount greater than would otherwise have been payable.
Relevant issues can include:
- Incorrect information provided by CRA officials;
- Actions taken by the CRA that caused additional tax, penalties, or interest;
- Whether the taxpayer reasonably relied on the information;
- Whether the taxpayer took reasonable steps to correct or minimize the problem; and
- Whether another statutory remedy was available.
A strong evidentiary record can be particularly important in CRA-error cases.
Unintended Results of Tax Legislation
Remission may also be considered where the administration of tax legislation produces an unfair result that appears contrary to the intended operation of the law.
This does not mean remission can be used simply because a taxpayer disagrees with existing tax policy or believes the legislation itself should be different.
The issue must generally arise from the application or administration of the law to the taxpayer’s particular circumstances.
Other Extraordinary Circumstances
CRA’s remission guidelines are not exhaustive.
A request may potentially be considered on another basis where the taxpayer can establish that collection would be unreasonable or unjust or that remission would otherwise be in the public interest.
When Is Remission Unlikely to Be Granted?
Certain situations are generally poor candidates for remission.
These can include circumstances where:
- The taxpayer has not provided sufficient supporting evidence;
- The problem affects taxpayers generally rather than arising from exceptional individual circumstances;
- The hardship is temporary;
- The problem resulted primarily from a third party, such as an accountant, adviser, or business associate;
- The taxpayer intentionally avoided or evaded tax obligations;
- The request is an attempt to reopen an audit, objection, settlement, or court decision;
- The taxpayer failed to use an available objection or appeal process within the applicable deadline;
- The taxpayer is attempting retroactive tax planning after discovering a more favourable alternative; or
- Granting remission would undermine the integrity of the tax system.
Even where one of these factors exists, the CRA may still consider whether exceptional circumstances justify a review.
What Must Be Done Before Requesting Remission?
The CRA currently expects taxpayers to resolve or exhaust other outstanding tax processes before requesting remission.
Generally, the relevant amount should already have been assessed.
The taxpayer should also normally have no unresolved:
- Return adjustment requests relating to the amount;
- Notices of Objection;
- Tax Court appeals;
- Taxpayer relief requests for applicable years;
- Voluntary Disclosures Program applications;
- Other litigation relating to the amount; or
- Insolvency proceedings affecting the obligation to pay.
Whether these conditions are satisfied should be reviewed carefully before preparing a remission request.
Remission vs. a CRA Tax Objection
A remission request does not replace the ordinary objection process.
If the taxpayer believes a CRA assessment or reassessment is incorrect, the normal remedy is generally to file a Notice of Objection within the applicable deadline.
Remission is generally intended for circumstances where the amount is legally payable but extraordinary circumstances make collection unreasonable or unjust, or where relief cannot otherwise be achieved under the tax legislation.
Learn more about our CRA tax objection services.
Remission vs. Taxpayer Relief
Taxpayer relief and remission are different remedies.
Under the taxpayer relief provisions, the CRA may have statutory authority to cancel or waive certain penalties and interest.
Taxpayer relief generally does not permit the CRA to cancel valid principal tax.
Remission is broader and may potentially apply to principal tax as well as penalties and interest, but it is significantly more exceptional.
Where taxpayer relief remains available, it should generally be pursued before remission.
Learn more about our CRA penalty and interest relief services.
Remission vs. CRA Collections
A remission request generally does not stop CRA collection action.
Outstanding amounts can continue to accrue interest, and the CRA may continue taking collection steps while the remission request is under review.
Where a taxpayer cannot pay the debt immediately, separate discussions regarding payment arrangements or collection issues may therefore be necessary.
Learn more about our CRA collections and tax debt services.
Can Remission Reduce the Principal Tax Owing?
Potentially, yes.
This is one of the important differences between remission and ordinary taxpayer relief.
A remission order may provide full or partial relief from qualifying federal tax itself, as well as penalties, interest, or certain other eligible amounts.
However, the fact that principal tax can legally be remitted does not mean that remission is routinely available.
CRA emphasizes that very few requests ultimately result in remission.
How Do You Make a CRA Remission Request?
A taxpayer or authorized representative can request a remission review by submitting a written request together with supporting documentation.
A complete request should generally identify:
- The taxpayer and applicable account number;
- The tax years or reporting periods involved;
- The amounts for which remission is requested;
- Whether the request concerns tax, penalties, interest, or another debt;
- The factual history giving rise to the debt;
- The legal and equitable basis for remission;
- Why other available remedies do not resolve the matter; and
- Documents supporting the circumstances relied upon.
The strength and completeness of the evidentiary record can materially affect whether a remission request is considered.
What Evidence May Be Required?
The appropriate evidence depends on the basis for remission.
Supporting documentation may include:
- CRA correspondence;
- Notices of Assessment or Reassessment;
- Objection and appeal records;
- Financial statements;
- Bank records;
- Income and expense information;
- Asset and liability information;
- Medical documentation;
- Evidence of communications with CRA officers;
- Tax filings and accounting records;
- Contracts or transaction documents; and
- Other documents supporting the exceptional circumstances.
For individual requests based on extreme financial hardship, the CRA also provides Form RC921, Remission Financial Disclosure Form for Individuals.
How Does the CRA Review a Remission Request?
The CRA first determines whether the request should be accepted for a formal remission review.
CRA states that it generally advises taxpayers in writing within 30 calendar days whether their request will be considered for review.
If a request proceeds, the CRA conducts an in-depth review of the taxpayer’s facts and circumstances.
The CRA may examine:
- The taxpayer’s submissions and supporting documents;
- CRA records and correspondence;
- Compliance history;
- Income, assets, and financial circumstances;
- Information from third parties;
- Court decisions;
- Property or public-record information; and
- Other evidence relevant to the request.
There is currently no fixed time period for completing a full remission review.
What Happens If the CRA Supports Remission?
If the CRA concludes that remission may be justified, the matter can be referred to the Minister of National Revenue.
The Minister may recommend that the Governor in Council grant remission.
If the Governor in Council approves the request, a remission order is issued and the CRA applies the authorized credit to the taxpayer’s account.
Where the credit produces a refund, the CRA may first apply it against other amounts the taxpayer owes.
A remission order does not result in a reassessment.
Are Remission Orders Public?
Yes.
Remission orders are published in Part II of the Canada Gazette.
CRA states that a published remission order includes information such as:
- The taxpayer’s name;
- The amount remitted;
- The applicable tax years or reporting periods; and
- A brief explanation of the basis for remission.
This public-disclosure aspect should be considered when deciding whether to pursue remission.
What Happens If a Remission Request Is Denied?
If the CRA determines that the circumstances do not support remission, it will advise the taxpayer in writing and provide reasons.
Where genuinely new information or documents exist that could not previously have been provided, the taxpayer may contact the CRA to determine whether further review is possible.
If the taxpayer believes the remission request was not properly considered, an application for judicial review in the Federal Court may be available.
The CRA currently states that the application should be filed within 30 days from the day the taxpayer was advised of the denial.
Learn more about our judicial review of CRA decisions.
What Can the Federal Court Do After a Remission Denial?
Judicial review does not ask the Federal Court to grant remission itself.
If the Court concludes that the remission request was not properly considered, it may set aside the decision and return the matter to the CRA for consideration by a different decision-maker.
The Court generally does not substitute its own remission decision for the administrative decision.
How Our Tax Lawyers Assist With Remission Requests
1. Assess Whether Remission Is an Appropriate Remedy
We review the tax debt, underlying assessments, previous proceedings, available statutory remedies, and exceptional circumstances to determine whether remission should be considered.
2. Identify the Strongest Basis for Remission
We assess whether the request may fall within CRA guidelines involving extreme financial hardship, financial setback with an extenuating factor, CRA error, unintended results of legislation, or other extraordinary circumstances.
3. Develop the Evidentiary Record
We identify and organize the financial records, CRA correspondence, medical evidence, tax documents, and other materials necessary to support the request.
4. Prepare the Remission Submission
We prepare a detailed written submission explaining the factual history, the amount for which relief is requested, why other remedies are inadequate, and why collection would be unreasonable, unjust, or contrary to the public interest.
5. Respond to CRA Information Requests
The CRA may request additional documentation or clarification during its review.
We can assist in preparing responses and communicating with the CRA throughout the process.
6. Advise on a Denied Remission Request
If remission is denied, we can review the reasons and assess whether additional information should be provided or whether Federal Court judicial review should be considered.
Why Work With KR Law Firm on a Remission Request?
Remission is one of the most exceptional forms of relief available in Canada’s federal tax system.
- Tax-Focused Legal Representation: Our practice focuses on Canadian tax disputes and CRA administrative matters.
- Remedy Assessment: We determine whether remission is appropriate or whether an objection, taxpayer relief request, VDP application, collection arrangement, or other process should be pursued first.
- Detailed Evidentiary Preparation: We help develop the documentary and factual record needed to support extraordinary relief.
- Legal Submissions: We prepare structured written arguments addressing the remission criteria and the taxpayer’s circumstances.
- Federal Court Experience: Where a remission request is denied, we can assess potential judicial review remedies.
Frequently Asked Questions About CRA Remission Orders
What is a CRA remission order?
A remission order is an extraordinary discretionary measure that can provide full or partial relief from certain federal taxes, penalties, interest, or other qualifying debts.
Can a remission order eliminate principal tax?
Potentially, yes. Unlike ordinary taxpayer relief, remission can legally extend to the underlying tax itself. However, remission is granted only in exceptional circumstances.
Does the CRA grant remission orders?
No. The CRA reviews remission requests, but only the Governor in Council has authority to issue a remission order under the Financial Administration Act.
Do I have to exhaust other remedies first?
Generally, yes. CRA considers remission a remedy of last resort and ordinarily expects other available tax remedies to have been pursued first.
Can I use remission because I missed my Notice of Objection deadline?
Generally, remission is not intended to extend or replace statutory objection and appeal deadlines simply because they were missed.
Can financial hardship qualify for remission?
Extreme financial hardship can be a basis for consideration, but the CRA applies a demanding standard and examines income, expenses, assets, liabilities, borrowing ability, future earning capacity, and basic living needs.
Can a CRA mistake support a remission request?
Potentially. The taxpayer generally needs evidence showing that incorrect CRA action or information directly caused an amount to become payable and that reasonable steps were taken to avoid or correct the problem.
Does filing a remission request stop CRA collections?
Generally, no. Collection action may continue and interest may continue to accrue while the remission request is under review.
How long does a remission request take?
CRA currently states that it generally advises taxpayers within 30 calendar days whether a request will be considered for review, but there is no fixed time frame for completing the full remission review.
Are remission orders public?
Yes. Remission orders are published in Part II of the Canada Gazette and include information concerning the taxpayer and the relief granted.
What happens if my remission request is denied?
Depending on the circumstances, new information may support further consideration. A taxpayer who believes the request was not properly considered may also seek judicial review in the Federal Court, generally within 30 days after being advised of the denial.
Speak With a Tax Lawyer About a CRA Remission Request
If ordinary tax remedies cannot adequately address an exceptional tax liability, KR Law Firm can assess whether a remission request may be appropriate.
We can review the history of the tax debt, prior CRA proceedings, available statutory remedies, financial and personal circumstances, and the evidence required to support a request for extraordinary relief.
Contact KR Law Firm to Book a Free Consultation with one of our tax lawyers.