While it can be a frustrating experience, it is fairly common for the Canada Revenue Agency (CRA) to make a tax return assessment that is different from yours.
The CRA collects and maintains your tax information, and they may already have some of your tax slips for the current year (for example, T4 slips submitted to the CRA by your employer,) as well as other tax-related information from previous years (such as carry-forward amounts, RRSP limits, etc.). When filing your taxes, the CRA considers all of this information in totality in making their assessment.
The reasons for these discrepancies may vary, and can range from very simple (typo or data entry error, forgotten slip, receipt, amount, etc) to complex (carry-forward amounts not included, accounting errors, etc).
Verifying the source of discrepancy between your NOA and the tax return you filed
In most cases, the CRA will explain how they calculated your tax refund or balance owing, and you can find this information on your Notice of Assessment (NOA), under the heading Explanation of changes and other important information. Compare the line numbers on your NOA and their corresponding values with those entered into TurboTax.
If you used the TurboTax online edition, use the printed or PDF copy of the tax return you filed using TurboTax or the detailed summary page of your tax return to do the comparison. If you used the TurboTax CD/download edition, switch to Forms method to do the comparison. If you need clarification or have any concerns, contact CRA.
- You expected a refund but the CRA shows a balance owing: immediately pay the CRA the amount you owe to avoid interest and penalty charges.
- The CRA shows a larger balance owing than you expected: immediately pay the CRA the outstanding amount to avoid interest and penalty charges.
- The CRA shows a smaller balance owing than you expected: If you’ve already paid the CRA the higher amount, you don't need to do anything. The CRA will refund you the difference.
If your NOA shows that you have a refund, but TurboTax calculated a balance owing (or the CRA shows a larger refund than you expected), it's important to consider not spending your refund until you verify what caused the refund, or are confident that the CRA’s assessment is correct.