Naugle – Federal Court requires CRA to reconsider cancelling tax under s. 207.06(1) given inconsistencies in the record as to when CRA notified of the TFSA over-contribution

The taxpayer sought cancellation pursuant to s. 207.06(1) of an assessment of taxes regarding her excess contributions to her TFSA for her 2021 and 2022 taxation years. She maintained that she did not find out about the over-contributions until speaking with CRA in the spring of 2023. CRA denied her request on the basis that she had received an assessment of her 2021 taxation year, showing the excess contribution, in July 2022, so that her repayment of the excess contributions, occurring later in 2023, did not represent timely repayment.

In granting the taxpayer's application for judicial review, so that the matter was referred back to CRA for reconsideration, Southcott J noted that this decision was unreasonable because it did not address inconsistencies in the record as to whether a notice was sent to her in July 2022.

Neal Armstrong. Summary of Naugle v. Canada (Attorney General), 2025 FC 926 under s. 207.06(1).