Tax Debt

Need relief from tax debt? We can help!

It’s understandable to be worried about tax debt; it’s a fairly common scenario. You may have started your own business, withdrawn too much money from RRSPs, or maybe you became liable for unremitted tax installments as a director of an incorporated company. A common misconception is that tax debt will never go away and that there is no relief from tax debt. This is simply not true and tax debt can be extinguished and compromised with the help of a Licensed Insolvency Trustee.

What can happen when you owe the Canada Revenue Agency for unpaid taxes?

When you incur tax debt, your common instinct is to try to fix it on your own and all you have to do is work a little harder. But in reality, it can be difficult to arrange a payment arrangement that is both suitable for you and the Canada Revenue Agency. Oftentimes the required minimum payment far exceeds your ability to pay and this often leads to borrowing, or using additional credit to meet those obligations, or you begin defaulting on your payments. Unfortunately, what you may not be aware of is the Canada Revenue Agency has a powerful set of collection tools at its disposal if you fail to pay your taxes.

Here are just a few of the tools the Canada Revenue Agency can use to collect unpaid taxes

  • Set off: The Canada Revenue Agency can re-allocate any payment of benefits to you and apply them towards your outstanding tax debt. So payments from GST/HST tax credit, Trillium, and other benefits can be used to reduce or pay your outstanding tax debts.
  • Garnishment: The Canada Revenue Agency can seize funds from banks, other third parties, and wages to satisfy tax debts.
  • Seizure and sale of your property: The Canada Revenue Agency can certify and register tax debts against real and personal property, effectively creating a charge or security interest against your home or other assets, also known as a lien. If the debt is not satisfied, they do have the authority to seize and sell the property or assets.
  • Holding a third party jointly responsible: In some situations, the Canada Revenue Agency has the ability to hold third parties such as related corporations, spouses and other partners liable for your unpaid taxes.

The good news is that there are solutions available to you. Tax liabilities can usually be addressed in a bankruptcy filing or a proposal made under the Bankruptcy and Insolvency Act. It is best if you promptly seek the guidance and advice of a Licensed Insolvency Trustee in these situations as the Trustee is best able to explain and review your options.

If you are unsure how to move forward or are struggling and overwhelmed with the threat of further action from the Canada Revenue Agency, call us today. We will review your options and show you how we can help protect you from further action, protect your property, and protect your wages.

Let’s start solving your problems today!

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