The Tax Court of Canada runs two procedural tracks, and for many ordinary taxpayers the right one is the Informal Procedure. It is the Court's faster, less formal, and far less costly route — designed so that an individual can challenge a CRA reassessment without the apparatus of full-blown litigation. This guide explains who qualifies, the dollar thresholds, how the simplified rules differ from the General Procedure, the trade-offs you accept by choosing it, and how a typical Informal Procedure appeal unfolds from the notice of appeal to judgment.
What the Informal Procedure is
The Informal Procedure is one of two procedural regimes under which the Tax Court of Canada hears appeals from CRA reassessments and determinations. It exists to give taxpayers a proportionate forum: a smaller dispute should not require the time, expense, and formality of a full civil trial. Under the Informal Procedure, the pleadings are simpler, discovery is limited or absent, the rules of evidence are relaxed, hearings are shorter, and the costs you can be ordered to pay if you lose are modest. The trade-off is that decisions carry limited precedential weight and a narrower right of further appeal.
An appeal reaches the Tax Court only after the objection stage. You generally must first have filed a notice of objection and either received a notice of confirmation or waited out the period in which the CRA failed to decide. How the two stages connect is set out in Notice of Objection vs Tax Court Appeal, and the litigation as a whole is mapped in The Tax Court of Canada Appeal Process.
The dollar thresholds
The Informal Procedure is available where the amounts in dispute fall within defined limits. Broadly:
- the federal tax and penalties in dispute for each year (excluding interest) are $25,000 or less;
- the loss in dispute for a year is $50,000 or less;
- for a GST/HST appeal, the amount in dispute is $12,000 or less; or
- the appeal concerns only interest assessed under the relevant Act.
The thresholds are applied year by year. A reassessment spanning several years can qualify even though the total across all years exceeds the limit, provided the federal tax in dispute for each individual year stays within it. Penalties count toward the limit; interest does not.
What if you are over the limit?
If the amount in dispute exceeds the threshold, you can still elect the Informal Procedure — but you must give up the amount over the limit. If your dispute for a year is $30,000 of federal tax, you can elect the Informal Procedure by abandoning the $5,000 above the $25,000 ceiling and litigating the rest. Whether surrendering that overage is sensible depends on the merits and on how much the simpler, cheaper process is worth to you. The Court also retains a discretion, in defined circumstances, to order that a matter proceed under the General Procedure where the Informal Procedure is not appropriate.
The simplified rules
Several features make the Informal Procedure markedly lighter than the General Procedure.
Simpler pleadings
The notice of appeal does not need to follow a formal template. It must set out, in plain language, why you say the reassessment is wrong and what relief you seek, but it is not held to the strict drafting standards of a General Procedure pleading. The CRA, represented by the Department of Justice, files a reply that sets out the Minister's position and the assumptions of fact relied on at reassessment.
No examinations for discovery
There is no oral examination for discovery in the Informal Procedure. The exchange of documents is limited. This removes one of the most time-consuming and costly stages of the General Procedure entirely, which is a large part of why the Informal track moves faster.
Relaxed rules of evidence
The Court is not bound by the strict rules of evidence in the Informal Procedure and may receive any evidence it considers appropriate, even if it would be inadmissible in a court of law. In practice this gives a self-represented taxpayer real latitude to tell their story and put documents before the judge without navigating technical objections.
Representation by a non-lawyer
You may represent yourself, or you may be represented by an agent who is not a lawyer — including an accountant or a family member. A corporation, which generally must be represented by counsel in the General Procedure, may have an officer or other agent appear for it under the Informal Procedure.
No filing fee, modest costs
There is no filing fee for an Informal Procedure appeal. Costs awards, if any, are modest and limited; you are not exposed to the kind of substantial costs order that can follow a loss in the General Procedure.
How an Informal Procedure appeal unfolds
- Notice of appeal. You file a notice of appeal within 90 days of the CRA's notice of confirmation (or after the 90-day no-decision threshold has passed). Filing how-to is covered in How to File a Notice of Appeal.
- Reply. The Department of Justice files a reply setting out the Minister's position and assumptions of fact.
- Hearing date. The Court schedules a hearing, often within a year of filing.
- Hearing. A short hearing — frequently a single day or less — at which you give evidence, the Crown tests it, and both sides make submissions. What that day looks like is described in What to Expect at a Tax Court Hearing.
- Judgment. The judge may give reasons orally at the end of the hearing or reserve and deliver written reasons later. The reassessment is upheld, vacated, or referred back to the Minister for reconsideration in accordance with the reasons.
The trade-offs
Speed and cost come at a price. Informal Procedure decisions have limited precedential value — they do not bind other judges the way a General Procedure decision can — and the right of further appeal is narrower. An Informal Procedure judgment can be challenged only by way of judicial review to the Federal Court of Appeal on limited grounds, not the broader appeal available from a General Procedure decision. For a one-off, fact-driven dispute over a modest amount, none of that matters. For a dispute that turns on a point of law you expect to litigate again, or where you want a precedent, the General Procedure may be the better choice even though the Informal track is available. The General Procedure is explained in The Tax Court General Procedure, Explained.
When to choose the Informal Procedure
The Informal Procedure tends to be the right fit when:
- the federal tax in dispute is within the threshold, or you are comfortable surrendering the overage;
- the dispute is fact-driven — a denied expense, an unreported-income allegation you can rebut with documents, a credit you say you were entitled to — rather than a complex legal question;
- you want to keep costs down and avoid the discovery stage; and
- you do not need a precedent or a full right of appeal.
The Informal Procedure is not "small claims for tax" in the sense of being trivial — the burden of proof still rests on the taxpayer, the assumptions of fact still have to be addressed, and preparation still matters. What it removes is the procedural weight, not the substance of the case.
How we help
Barrett Tax Law represents taxpayers and corporations in Tax Court appeals under both the Informal and General Procedures, from the notice of appeal through the hearing. Because the framing of the dispute carries through from the objection into the litigation, the two stages are best planned together. You can read more on our Tax Court of Canada page, and on the earlier stage at how to file a notice of objection.