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).
What should I do if CRA says I owe a balance?
- 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. For more information, read CRA: Payments options.
- The CRA shows a larger balance owing than you expected: immediately pay the CRA the outstanding amount to avoid interest and penalty charges. For more information, read CRA: Payments options.
- 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.
What should I do if CRA says I have a refund?
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.
