Statute-Barred Date: Why Isn't There Always One?

Abstract

The Canadian Income Tax Act imposes limitations on the time period during which the minister is allowed to assess or reassess a taxpayer. Generally, the limitation period for assessment or reassessment is three or four years from the date of the original assessment. This article addresses the many provisions in the Act that give the minister the authority to assess or reassess without specifying a limitation period. The authors group these provisions into categories according to the circumstances that they address. Within this framework, they review the rationale behind the omission of a limitation period and consider whether that policy is justified. The authors then provide a summary discussion of the positions of the Canada Revenue Agency and the courts with respect to assessment beyond the normal limitation period, and the options available to taxpayers who seek to make changes to a statute-barred return. Finally, the authors present their recommendations for the amendment of specific provisions where a limitation period would be justified.