Who can apply

The CRA may issue a refund or reduce the amount owed to an individual or graduated rate estate provided that such a refund or reduction would have been made if:

• the return or request was filed or made on time
• the necessary assessment is correct in law and has not already been allowed

The CRA may issue a tax refund to an individual or graduated rate estate even though:

• an income tax return is filed beyond the normal 3-year period, or
• a request to make a reassessment to refund or reduce tax payable is beyond the 3-year normal reassessment period

If there is a testamentary trust that is not a graduated rate estate

As of January 1, 2016, a testamentary trust (that is not a graduated rate estate) can no longer do the following for the 2016 and later tax years, after the normal 3-year period has expired:

• file an income tax return with the intent of getting a refund
• request an adjustment to a previously filed return with the intent of reducing the tax payable

Testamentary trusts can still file a return or ask for an adjustment for the 2015 tax year if you missed claiming a deduction or credit that was available for the year, including any overpayment of taxes deducted from your salary

Instances when your request will or may be denied

• Dispute an assessment or reassessment

  The purpose for requesting an adjustment beyond the normal 3-year period cannot be to dispute how correct or valid a previous assessment is or to dispute the issues through the normal objection or appeal process. For example, you disagree with an audit reassessment, or the issues you list in your relief request were already addressed through the objection process. For more information, go to File an objection.

• Requests affecting the statute-barred income tax return of another individual

  The CRA will generally not accept a request for an adjustment beyond the normal 3-year period if the adjustment would result in the increase of taxes, interest, or penalties to the return of other taxpayers that are statute-barred and the CRA cannot reassess them.

• Provincial and territorial benefits and refundable credits

  The legislation that allows the CRA the discretion to refund or reduce the amount payable beyond the normal 3-year period does not override provincial limitations, unless it is indicated in the provincial Act.

• Permissive deductions

  The CRA will not process requests for adjustments when the taxpayer originally claimed less than the maximum amount allowed. For example, if you are requesting an adjustment to claim a higher capital cost allowance, or other allowed deductions, to reduce your tax owing. For more information, see Information Circular IC84-1, Revision of Capital Cost Allowance Claims and Other Permissive Deductions.

• Employment Insurance premiums and Canada Pension Plan contributions

  The legislation contained in the ITA that allows for the refund beyond the normal 3-year period does not apply to refunds of overpayment of Employment Insurance (EI) premiums or Canada Pension Plan (CPP) contributions.

  The time limit to make an application for refunds of excess premiums or contributions is three and four years, respectively, under the Employment Insurance Act and the Canada Pension Plan legislation.

  Refer to IC07-1R1 paragraph 86 for additional information.

• Requests based on a court decision or other resolution

  Generally, the CRA will not reassess a statute-barred return if a request is made because of a court decision. For more information, see Information Circular IC75-7R3, Reassessment of a Return of Income. Where a taxpayer has chosen not to take advantage of their right of objection or appeal for a tax year, requests made to reassess a statute-barred return based only on the result of an appeal by another taxpayer or by the same taxpayer will not be granted.

  Similarly, knowledge of another taxpayer's negotiated settlement to resolve an objection, or another taxpayer's consent to judgment on an appeal, will generally not be grounds to allow an adjustment beyond the normal 3-year period if the taxpayer did not take advantage of their right to object or appeal.