How to Overturn Negative Determination by CRA
You may have been wrongly denied
If your SR&ED claim has been reduced or denied, ask yourself these questions:
- Did your SR&ED claim involve an acquisition of knowledge, even small amounts of knowledge?
- Was the knowledge gained generally accessible to a competent professional in his or her field?
If you believe your company gained knowledge that was not generally accessible to a competent professional in his or her field and that you approached your work in a systematic way, your SR&ED claim may have been wrongly denied.
If your SR&ED claim has been wrongly denied or reduced, you can seek to have it overturned. Similarly to a traffic ticket, upon receiving a decision from CRA, you have options to dispute the decision. You can either appeal to the CRA itself or to the Tax Court of Canada.
What can you do?
Your first option is appealing to CRA. They usually do not change their stance. Your objection is sent to the Appeals division where an auditor will usually confirm the standing decision. Overturning a decision usually requires you to take the matter out of CRA’s hands.
The second and more effective option is appealing to the Tax Court of Canada. This does not necessarily mean going to court. As with many court matters, SR&ED cases are often settled before they get to court. If the matter does go to court, a judge will be likely to decide in your favor provided you have been wrongly denied.
It is not an “extreme” move to appeal your SR&ED claim to the Tax Court. After all, the only reason tax courts exists is because tax payers do not always agree with the CRA.
Overturn the decision
- Avoid high legal costs – rather than charging by the hour, we offer a contingency model. This means we only get paid when we win.
- File a notice of objection to the appeals division of CRA.
- File a notice of appeal with the Tax Court of Canada.
- Prepare settlement proposals – many SR&ED cases settle before they get to court.
- Receive full legal representation and advice – our team of experienced litigators and SR&ED tax consultants will ensure your best position for success.