Canada Revenue Agency Tax Debt – When you Owe Money
If you happen to owe money to the CRA (Canada Revenue Agency), this is something that you want to handle in a timely manner. Chances are if you received a CRA Notice or Notice of Reassessment, this unexpected tax debt can be overwhelming and unexpected.
If there was an error on your Tax Filing, bringing this to your Tax person to further investigate and confirm can help.
If you are not able to pay your tax debt at the time you filed, there are options with the CRA. Just to note, full disclosure of your finances may be needed, and you may also need to provide expense, income, liabilities to the CRA collections. officer. This certainly is an available option, if it is just for you or your business, you can look to talk about payment arrangements.
CRA Debt Negotiations
If you do not have the money to repay your CRA Debt, it is possible that this debt under certain conditions can be included within a Bankruptcy or you can look at a Consumer Proposal.
In order to start this, your situation will need to be explained. You can look to negotiate a repayment plan for your current debt over the next 12 months or so. From there, the Canada Revenue Agency will then decide if they will take your offer or not.
Results of Not Paying your CRA Debt
- GST and the Child Tax credits can be withhold
- Interest and Penalties will continue to be added
- Possible for Wage Garnishment
- Removal of money from your bank account
As you can see, this is not something that can be treated lightly. This will need to handled ASAP.
Going the Route of a Consumer Proposal may be the best option to dealing with this debt. Settling your tax debt can be worrisome and in cases like this, David Sklar & Associates, Inc. can look to help you with your Consumer Proposal and make the negotiations to the CRA on your behalf