You've received a tax notice. Here's the next 30 days.

A notice from the tax authority is a request for a response, not a finding of guilt. Most are generated because something in your file did not reconcile against something else in the department's data, and most close once the discrepancy is explained on paper.

The damage, when it comes, is usually self-inflicted. Two responses cause almost all of it: saying nothing until the date passes, and sending a reply the same afternoon the notice arrives.

Day one: read it, and reply to nothing

The instinct on opening a notice is to make it go away before the end of the day. Resist it. Nothing gets worse because you took the time to understand it first; a great deal gets worse because you answered before you did.

Do not telephone the officer to explain. An unrecorded conversation cannot be relied on afterwards, and off-the-cuff explanations harden into positions you never meant to take. Read the notice twice: once for the shock, once for the content.

Work out what kind of notice you are actually holding

Notices are not interchangeable, and the right response to one is the wrong response to another. A request for information asks you to produce records or explain an entry. An assessment states a position the department has taken, or proposes to take, on what you owe. A demand asks for payment of an amount already fixed.

The distinction tells you how much is still open. Information requests are the earliest and most common stage, and the stage where the outcome is most within your control. By assessment the argument has narrowed; by demand it has usually moved into the appeal process. Establish the basics from the face of the document first.

• Which tax it concerns: income tax, sales tax on goods, sales tax on services
• Which authority issued it, federal or provincial
• Which tax year or tax periods are covered
• Whether it asks for documents, states a proposed position, or demands money
• The date a response is due, and the channel it must be filed through

The deadline decides more cases than the facts do

Find the date stated on the notice and treat it as immovable unless you hold an extension in writing. Missing it rarely just delays matters: it lets the department proceed on the information already in front of it, so an arguable position becomes a settled one because nobody answered.

If the period allowed is genuinely too short, ask for an extension in writing before the date passes, with a reason and a date you can meet. A request made late, or made only by telephone, tends not to exist when it matters.

Week one: assemble the evidence before drafting anything

Work in the order of evidence first, argument second. Pull the records relating to the entries and periods named, and read them yourself before deciding what your answer is. Drafting first and hunting for support afterwards produces replies that must be corrected later, and corrections cost far more than delay.

What you find will fall into three groups: matters fully supported by documents, matters right in substance but with a gap in the paperwork, and matters where the department is simply correct. Sorting them honestly now is what allows a short, confident reply later, and where you are wrong, saying so early is the cheapest route available.

• The ledger entries and filed returns the notice refers to
• Invoices, contracts and agreements sitting behind those entries
• Bank statements evidencing the money actually moving
• Correspondence created at the time of the transaction
• Any earlier filing or reply that touches the same issue

Week two: answer exactly what was asked, and stop

Reply to the question in front of you, completely, and then stop. The most common self-inflicted injury at this stage is the helpful letter that explains three things nobody asked about. Every additional fact volunteered is a new thread, and threads get pulled.

Structure matters more than eloquence: a short covering letter, a numbered list of the points raised, a direct answer against each, and page-numbered annexures cross-referenced to those answers. If a document genuinely cannot be produced, say so plainly and explain why, rather than substituting an approximation that will later be read as fact.

Be consistent with everything already on file. Your reply will be read alongside your returns, your statements and your earlier correspondence, and an explanation that contradicts a previous filing creates a larger problem than it solves.

Everything in writing, with proof that it was filed

File through the channel the notice specifies and keep evidence that you did so: the electronic acknowledgement, the stamped receipt, the dispatch record. A submission you cannot prove you made is, in practice, a submission you did not make.

Keep a complete copy of what was sent, with the annexures attached as filed. If the matter runs on, or moves to appeal, that file becomes the record everyone works from.

If the reply is not accepted

Not every notice closes on the first answer, and that is not a disaster. There is an ordered path onwards, and the point is to take it in sequence rather than jumping to the loudest step.

Where an order contains an obvious mistake, a figure carried across wrongly or a credit not given, the first route is rectification: asking the same office to correct its own error. Where the objection is to how the matter was decided inside the department, there is an internal revision route. Where the disagreement is genuinely about law or facts, it goes to appeal, beginning with the first appellate authority and capable of going higher.

Each carries its own time limit and filing requirements, and they are unforgiving. Confirm the current limits when the order arrives, not when you get round to it. Filing an appeal also does not necessarily suspend recovery, so where payment pressure is a real concern it must be raised separately and at the same time.

When representation is worth paying for

Plenty of notices can be handled in-house. A request for a copy of an invoice, a mismatch between a return and a withholding statement, a query on a single entry: these need records and care, not a professional.

Bring in an adviser when the matter stops being about documents and starts being about position: a significant amount proposed to be added or disallowed, an answer that turns on how a transaction is characterised in law, or the same issue running across several years. Judgement about what to say is worth more at that point than fluency in saying it.

Records created at the time of the transaction carry weight; records assembled after a notice arrives do not, and the difference is obvious to anyone who reads files for a living. Most of the work that settles a notice was done months before it was issued.

Most notices are routine and close on paperwork. The ones that turn serious usually did so for one of two reasons: nobody replied, or somebody replied too fast. Neither is imposed from outside.