Availability of Confidentiality Orders from the Tax Court of Canada

Marco Iampieri B.A., JD, M.B.A

A reassessment following an audit from the CRA is deemed valid and binding subject to being proved incorrect by the taxpayer on a balance of probabilities (above 50%). In order to prove that the reassessment is inaccurate, the taxpayer may have to disclose confidential or otherwise privileged corporate documentation at trial. However, these documents can be accessed by corporate competitors by searching the Court Registry at the Tax Court of Canada.

A taxpayer who finds themselves in a similar situation may apply to the Tax Court of Canada for a confidentiality order pursuant to section 16.1 of the Tax Court of Canada Rules. The confidentiality order will allow the taxpayer to present confidential information, which may be injurious to their business, in a manner that allows the Tax Court of Canada judge to analyze their documentation, while maintaining the confidentiality of the document to the public.

In the recent Tax Court of Canada case styled Shell Canada Limited v. Her Majesty the Queen – 2022 TCC 39, the Appellant was granted a confidentiality order because of the Appellant’s worry that a competitor might access the confidential documents that the Appellant chose to rely upon in order to demonstrate that the reassessment is inaccurate.

Key Takeaway: Taxpayers should not be afraid to disclose information that may be injurious to their business, as confidentiality is available from the Tax Court of Canada.

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