Notice Of Objection Failed To Define The Dispute

Some objection-stage failures are obvious. Others remain invisible and lead to the same result. (941624 Alberta Ltd. v. HMK) 

Key Takeaways

•  The reassessment shows the financial exposure. What moves forward depends on how the taxpayer frames the dispute in the Notice of Objection. 
•  In this case, the taxpayer’s Notice of Objection failed in a clear way. In most disputes, taxpayers do not see the failure as clearly. 
•  Taxpayers and their advisors often miss strategic and Notice of Objection failures, which narrow both the arguments and the range of outcomes. 

The Situation

941624 Alberta Ltd. appealed reassessments involving unreported income and denied expenses. Because the company was a large corporation, it had to meet the specific objection requirements under the Income Tax Act to preserve its appeal rights. The ITA imposes these requirements through the large-corporation objection rules, including subsections 165(1.11) and 169(2.1), which define what can move forward on