Tax Debt Relief in Canada

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Do You Owe Taxes to CRA? Anyone can need help with tax debt. In fact, 40% of our clients owe money to the Canada Revenue Agency. Whether it’s unpaid income tax debt, GST/HST, source deductions, there are safe, legal ways to reduce or eliminate your CRA debt – and stop collections before they get worse.

Get Tax Debt Relief

Before choosing how to deal with tax debt, it’s important to understand what you’re up against.

The Canada Revenue Agency (CRA) has powerful tools to collect unpaid taxes. They can garnish your wages without going to court, freeze your bank accounts, seize investments or income tax refunds, even register a lien on your home or property. These actions can happen quickly and without much warning.

That’s why any solution you choose must do more than just reduce your balance—it must also legally stop CRA collections.

Here are your main options when dealing with CRA tax debt:

  1. CRA Repayment Plan
  2. CRA Fairness Application
  3. Consumer Proposal
  4. Personal Bankruptcy

  • Can CRA forgive tax debt in Canada?

  • What’s the best way to stop CRA collections?

  • Can tax debt be included in a proposal?

Book a FREE consultation today

Options When Dealing With Tax Debts

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1. Arrange A Repayment Plan With CRA

You can contact the Canada Revenue Agency and arrange to pay the full tax debt amount (plus interest and penalties) through monthly payments directly to the CRA. They will not reduce the debt, but may allow you time to repay your tax obligations.

You could consider getting a loan to pay off your tax debt however, as with any debt consolidation loan, this comes with it’s own risks. If you can only qualify for a high-interest rate loan you may be trading one debt for another and may still face financial problems down the road.

2. Make A CRA Fairness Application

This is a government program that grants relief from interest and penalties, but not the principal portion of your tax debt. You must prove extraordinary circumstances and financial hardship that supports your inability to repay your full tax obligation. You may also need to engage the services of a tax lawyer to assist you with this application.

3. File A Consumer Proposal

The only tax relief program that the CRA will accept is a consumer proposal filed with a Licensed Insolvency Trustee. With a consumer proposal, you make a deal to repay what you can afford.  An offer is made to the Canada Revenue Agency, along with your other creditors, to repay less than what you owe.

An advantage of a consumer proposal to clear tax debt is that you can also deal with other unsecured debt at the same time including credit card debt.

The Canada Revenue Agency generally requires that all outstanding tax returns be filed prior to voting to accept the proposal in order to confirm the actual tax amount owing to CRA.

Here are some additional resources written by our team of Licensed Insolvency Trustees:

4. File Personal Bankruptcy

If your income tax debt combined with other financial obligations becomes insurmountable filing bankruptcy can eliminate tax debt entirely and immediately stop CRA enforcement actions.

Get Help With CRA Tax Debt From A Licensed Insolvency Trustee

By filing a bankruptcy or consumer proposal under the Bankruptcy & Insolvency Act, a Licensed Insolvency Trustee can gain an automatic stay of proceedings which will immediately stop CRA collection actions. In the case of a consumer proposal, this allows you the time to negotiate an acceptable payment arrangement with CRA.

  • Stop wage garnishments
  • Reverse frozen bank accounts
  • Keep HST/GST and child tax credits
  • Prevent property liens

If you owe taxes in Canada, we can provide you with options to deal with money owing to the Canada Revenue Agency. Our trustees are experts in negotiating with the CRA and eliminating all tax debt.

  • ✅ Get trusted help with CRA tax debt – federally licensed
  • ✅ 99% proposal approval rate – CRA included
  • ✅ No upfront fees. Free, confidential consultations

At Hoyes Michalos, we have the experience necessary to work with you and the CRA to arrange a plan, that you can afford, to deal with your tax debt.

Book a free consultation today

Hoyes Michalos & Associates provides tax debt relief solutions in the following Ontario locations

We offer the convenience of phone and video-conferencing services in the following additional locations:

  • Barrie
  • Brockville
  • Chatham
  • Cornwall
  • Huron
  • Kingston
  • Leamington
  • Newmarket
  • Niagara Falls
  • North Bay
  • Parry Sound
  • Pembroke
  • Peterborough
  • Sarnia
  • Sault Ste. Marie
  • Stratford
  • Sudbury
  • Thunder Bay
  • Timmins
  • Woodstock