Resolving Mismatched
T4 Information with CRA

When your T4 information doesn't match your T1 personal tax return, CRA's automated system will identify the discrepancy. Here is the complete guide to what happens and what to do: How CRA finds the mismatch: CRA receives T4 slips from employers by February 28 (filed electronically in a standardized format). After the April 30 T1 filing deadline, CRA's automated processing system matches every T4 to the corresponding T1 return using the employee's SIN. The matching compares: T4 Box 14 (employment income) to T1 Line 10100; T4 Box 22 (income tax deducted) to the total withholding credits; T4 Boxes 16/18 (CPP and EI) to the corresponding credit claims. Any significant discrepancy is flagged in CRA's system. Timing of CRA action: CRA's matching typically occurs 4-18 months after the T1 filing deadline. So if you filed your 2025 return in April 2026, CRA might identify a T4 mismatch in late 2026 or 2027 — but the interest would have been accruing since May 1, 2026 on any additional tax owing. CRA's possible responses: (1) Automatic correction: for obvious, minor discrepancies, CRA may automatically correct your assessment and issue a revised Notice of Assessment without asking for explanation. (2) CRA letter requesting explanation: CRA sends a letter asking you to confirm or explain the discrepancy within 30-45 days; respond with supporting documentation (T4 copy, pay stubs). (3) Notice of Reassessment (NoR): CRA reassesses your tax owing based on the T4 information; the NoR shows the revised income, tax, and any balance owing with interest from April 30. (4) Audit: significant discrepancies may trigger a broader audit of the tax year. What you should do before CRA contacts you: proactive correction is always better than waiting for CRA: file a T1 Adjustment through CRA My Account if you under-reported income; get your employer to amend the T4 if the T4 itself is wrong. Filing before CRA contacts you avoids the 10% repeated under-reporting penalty and demonstrates good faith. Interest calculation example: suppose you under-reported $5,000 of income (you have a $5,000 discrepancy between your T4 Box 14 and T1 Line 10100). At a combined marginal rate of 33%: approximately $1,650 in additional tax owing. Interest at 9% annually from May 1, 2026 to a CRA reassessment issued in December 2026 (7 months): approximately $86 in interest. Total: approximately $1,736. This increases daily if not resolved. If you over-reported income: if your T4 shows less income than you reported (you over-reported), CRA will issue a refund when it identifies the mismatch. You don't need to wait for CRA — file a T1 Adjustment immediately to get your refund faster.

Fixing an incorrect T4 involves two parallel processes — correcting the T4 at the employer level, and potentially correcting your personal tax return. Here is the complete step-by-step guide: Step 1 — Contact your employer's payroll department: write to your employer's payroll administrator or HR department (use email to create a written record): specify the exact error on the T4: "Box 14 shows $65,000 but my actual employment income for 2025 was $72,000 including the $7,000 car benefit that appears not to have been included" or "Box 22 income tax deducted shows $12,400 but my year-end pay stub shows $14,850 was withheld." Request the employer file an amended T4 with CRA. Ask for a copy of the amended T4 to be provided to you when it is filed. Timeline expectation: a cooperative employer should be able to file an amended T4 within 2-3 weeks of your request. Deadline: there is no formal deadline for voluntary T4 amendments, but earlier is better for everyone. Step 2 — If the employer confirms the error and files an amended T4: check CRA My Account approximately 2-4 weeks after the employer says they filed the amendment — the amended T4 should appear under Tax Slips. Compare the amended T4 amounts to what you originally reported on your T1. If your T1 was already filed with the incorrect T4 amounts: file a T1 Adjustment (online via My Account ReFILE or paper T1-ADJ) to correct your return to match the amended T4. Step 3 — If your T4 was incorrect but you had already filed your T1 correctly (reporting the right income despite the T4 error): this can happen when you knew your income was different from the T4 (e.g., you received a bonus not on the T4, or you knew the T4 was wrong). In this case: your T1 is already correct; have your employer file the amended T4 to match your T1; CRA's matching will then show no discrepancy after the amendment is processed. Do NOT file a T1 Adjustment unless your T1 return itself needs correction — changing your T1 to match an incorrect T4 would make your return wrong. Step 4 — If the employer refuses to amend the T4: this is a more challenging situation. Options: contact CRA's Employer Services line (1-800-959-5525) to report that your employer filed an incorrect T4 and refuses to amend it; CRA can investigate and compel the employer to correct the T4; file your T1 based on what you believe is the correct income amount, even if it differs from the T4; attach a written explanation to your T1 (in the "Other Information" section, or as a supporting document with your filing) explaining why your reported income differs from the T4 and providing supporting evidence (pay stubs, employment contract, expense reports). If CRA later reassesses your return to match the T4 (rather than your stated income): file a Notice of Objection within 90 days with your supporting documentation. CRA help line for T4 issues: Individual tax enquiries: 1-800-959-8281 (individuals, personal T4 questions); Employer enquiries: 1-800-959-5525 (payroll/T4 filing questions for employers); Represent a Client: your CPA can access CRA systems on your behalf through their representative portal to verify T4 information and communicate with CRA directly.

Yes — CRA has broad authority to reassess your personal income tax return when T4 and T1 information doesn't match, and the reassessment can include interest going back to April 30 of the tax year. Here is the complete framework: CRA's reassessment authority under the Income Tax Act: Section 152(3.1): CRA can reassess any T1 return within 3 years of the original Notice of Assessment (the 'normal reassessment period'); for most employees with straightforward T4 mismatches, this 3-year window is the applicable period; the 3-year clock starts from the date on your original Notice of Assessment, not from when you filed the return. Beyond the normal reassessment period: if CRA alleges misrepresentation due to neglect, carelessness, or wilful default: CRA can reassess outside the 3-year normal period; there is no time limit on reassessments where CRA alleges fraud or intentional misrepresentation. The automatic reassessment process: CRA's automated matching identifies the T4/T1 discrepancy; CRA issues a Notice of Reassessment (NoR) based on the T4 information on file; the NoR includes: revised total income; revised tax owing; interest calculated from April 30 of the tax year to the date of the NoR (and continuing until the balance is paid); any applicable penalties. What the interest calculation looks like: if CRA reassesses $8,000 of additional income in November 2026 for the 2025 tax year: at 33% marginal rate: approximately $2,640 in additional tax; interest at 9% annually from May 1, 2026 to November 15, 2026 (6.5 months): approximately $128; total owing: approximately $2,768; this continues to grow at $0.65/day until paid. Your rights after receiving a Notice of Reassessment: you have 90 days from the date on the NoR to file a Notice of Objection (Form T400A or online through My Account); the objection must specify: the item in dispute; the amount at issue; the reason you believe the reassessment is incorrect; supporting documentation. CRA's Appeals Division reviews the objection. If unresolved: you can appeal to the Tax Court of Canada within 90 days after receiving CRA's response to your Objection (or after 90 days from filing the Objection if CRA hasn't responded). Paying while objecting: you must generally pay the assessed balance while your Objection is being processed (otherwise interest continues to accrue); if your Objection succeeds: CRA refunds the overpayment with refund interest; if you genuinely cannot pay: you can request a payment arrangement with CRA while the Objection is processed. Proactive approach — don't wait for a reassessment: filing a T1 Adjustment before CRA contacts you: demonstrates good faith; stops the interest clock sooner; avoids the 10% repeated under-reporting penalty (which only applies after CRA has previously notified you of an under-reporting); reduces the risk of audit (because CRA sees you as proactively compliant). The single best financial decision when you discover a T4 mismatch that results in under-reported income: estimate the additional tax owing, make a payment to CRA My Account immediately (this stops the daily interest accumulation on that amount), and then file the T1 Adjustment to formally correct the return.

T4 boxes that are most commonly misstated — whether by employers or by employees entering T4 data on their tax returns — fall into predictable patterns. Here is the comprehensive guide to T4 box errors and their CRA consequences: Box 14 — Employment Income (most common and most significant mismatch): what should be here: all employment income including regular wages and salary, overtime, vacation pay, bonuses (in the year paid), commission, tips and gratuities, most benefits and allowances, retiring allowances (if eligible for rollover to RRSP). What is commonly missing: taxable benefits — these are employer-provided perks that are considered employment income under the ITA: (a) automobile benefits: if your employer provides you a company car for personal use, the 'standby charge' (based on the car's cost and your access) and 'operating benefit' (based on your personal kilometres) are both taxable and must be in Box 14. Many employers forget to calculate or include this. (b) Group insurance premiums: employer-paid premiums for life insurance above $25,000 of coverage, and employer-paid provincial health premiums in some provinces, are taxable benefits. (c) Employer RRSP contributions: if your employer contributes directly to your RRSP, this is employment income. It appears in Box 40 AND increases Box 14. (d) Parking: employer-provided parking in a metropolitan area where parking is generally not available to the public for free — the fair market value of the parking is a taxable benefit. (e) Gifts and awards above $500: gifts (non-cash) up to $500 total per year are non-taxable; above $500, the entire amount is taxable. Cash gifts are always taxable. (f) Fitness membership: employer-paid gym memberships are generally taxable benefits unless they are a workplace facility (on-site gym). What is sometimes incorrectly included: workers' compensation payments (non-taxable — should NOT be in Box 14); employment insurance benefits if paid through the employer's sick plan (may or may not be taxable depending on structure — complex area); disability benefits from an employee-paid disability plan (non-taxable if the employee paid 100% of the premiums). Box 16 — Employee CPP Contributions: common errors: over-deducting CPP when an employee is exempt (under 18, over 70, receiving CPP/QPP disability, employed by their corporation after receiving CPP); under-deducting CPP in the year an employee turns 70 (CPP deductions stop when the employee turns 70, but employers sometimes continue deducting); confusing CPP1 and CPP2 (the enhanced CPP requires an additional separate deduction — many older payroll systems don't handle CPP2 correctly). Box 18 — Employee EI Premiums: common errors: not identifying EI-insurable vs. non-insurable employment (employment of related family members, certain shareholder-employees may be exempt from EI); continuing to deduct EI after the annual maximum is reached (the maximum insurable earnings cap must be applied per year per employer); province code errors affect the EI rate in Quebec (Quebec has its own parental insurance plan and a lower federal EI rate). Box 22 — Income Tax Deducted: common errors: wrong province of employment (Box 10) — the most common error for remote workers; if an employee works from home in Ontario for a Quebec-based employer, Box 10 should show ON (Ontario tax rates apply); using the wrong provincial withholding tables when an employee's personal province differs from the province of employment; under-withholding when employees submit TD1 forms with incorrect personal amounts claimed. Box 40 — Other Taxable Allowances and Benefits: this box is a catch-all that is consistently under-reported. It should include any taxable benefit not already specifically coded in another box. Most frequently missing: taxable car allowances (flat monthly car allowances that are not based on actual distance traveled are fully taxable); personal use of a company vehicle not calculated as standby charge; employer-paid professional dues (may be taxable); employer-paid internet and cell phone (the personal-use portion is taxable); merchandise discounts above normal customer discounts. Box 52 — Pension Adjustment (PA): PA errors are particularly serious because: errors in Box 52 flow through to the employee's RRSP contribution room calculation (the RRSP limit is reduced by the prior year's PA); a PA that is too high reduces the employee's RRSP room and may prevent them from making the RRSP contributions they are entitled to; a PA that is too low inflates RRSP room and may cause the employee to over-contribute to their RRSP; RRSP over-contributions carry a 1% per month penalty — a cascading consequence of a single Box 52 error.

CRA's T1 Adjustment processing times for T4 mismatches depend heavily on how you submit the adjustment and the complexity of the change. Here is the complete timeline guide: Online via CRA My Account — Change My Return (ReFILE): fastest option: submission: instant confirmation when you submit online; initial CRA processing: typically begins within 1-2 business days of submission; estimated completion: 2-8 weeks for a straightforward T4 income correction; status tracking: log into My Account → Tax Returns → View my T1 adjustment status; you'll see: "Received" → "Under review" → "Completed" with dates; What can delay online processing: if CRA's system flags the adjustment for manual review (this happens when the change is large or unusual); if your file is currently under CRA review for another reason; if CRA needs to request additional information (they'll send a letter). Online via NETFILE / ReFILE through tax software: same processing time as My Account (2-8 weeks); available for returns from the prior 10 years if the software supports prior-year filing; you file the amended return directly from your tax software, which submits it to CRA via NETFILE. Paper Form T1-ADJ: mail your T1-ADJ to the CRA tax centre for your province (address listed in CRA's T1-ADJ instructions); CRA's stated processing time: 12-16 weeks; during peak filing season (February-June): may extend to 20+ weeks; status: paper submissions can be tracked in My Account after CRA's system is updated (allow 4-6 weeks from mailing for it to appear). Factors that extend processing time: larger dollar adjustments (above $10,000 in income change): more likely to trigger manual review; adjustments affecting multiple tax years simultaneously; adjustments that interact with benefit programs (GST/HST credit, Canada Child Benefit): CRA coordinates with the benefits department, which can add time; adjustments following a previous CRA audit: your file may be flagged for more careful review; submitting incomplete information: if CRA needs to request supporting documents, the clock resets; peak filing season (February through June): significantly higher volume of adjustments being processed. What you receive when processing is complete: CRA mails a Notice of Reassessment (NoR) to your address on file, OR you can see it electronically in My Account → Mail; the NoR shows: the revised taxable income; any balance owing or refund; interest charged on any additional tax (if you under-reported). If a refund is due: CRA issues the refund within approximately 2 weeks of the NoR being issued; refunds go by direct deposit (if registered in My Account → Banking → Direct deposit) or by cheque. If a balance is owing: the NoR shows the amount; pay as quickly as possible after receiving the NoR — interest has been accruing since April 30 and continues until the full payment is received by CRA. Practical tip — pay before the adjustment is processed: if your T1 Adjustment will result in additional tax owing, don't wait for the NoR: calculate the approximate additional tax owing; make a payment to CRA My Account → Make a payment → Balance owing (or through your bank's bill payment to CRA); when the NoR is issued, the payment you made is applied against the assessed balance; this stops the daily interest clock on the amount you've paid, saving money regardless of when CRA processes the formal adjustment. Following up with CRA: if your T1 Adjustment has not been processed beyond the expected timeline: log into CRA My Account to check the status; call CRA's Individual Tax Enquiries at 1-800-959-8281; be prepared with: your SIN; the tax year being adjusted; the date you submitted the adjustment; the type of adjustment (T4 income correction); CRA agents can see your file and provide an update on the status and expected completion date.