The Canada Revenue Agency does not have to get a court order to seize your wages. Where your wages have been garnished by the government we can have the garnishment rescinded and show you how to reduce the debt you owe.
Taxes owed are usually considered as unsecured credit and are able to be discharged in a bankruptcy with exceptions.
The exceptions are;
- the tax liability is under 200,000 dollars
- the tax liability is more than 75% of your unsecured debt
In bankruptcy where the bankrupt reaches these thresholds to stop a garnishment the matter must be brought before a judge.
The judge will decide upon the conditions for the debt before it may be discharged, which may included making a payment towards the debt.
Where there are taxes owed a lien can be registered on property held or placed on your home. Once a lien is registered on property it becomes a secured debt.
When a lien has been placed on your home it means that the debt cannot be discharged through bankruptcy. The bankrupt must either sell the home and pay the debt or make the payments, as if a mortgage has been placed upon the home.
While there is outstanding taxes owing the CRA can withhold payments for:
- tax refunds,
- child tax credits,
- Canada Pension Plan
- Old Age Security
- HST and tax refunds
Where you believe that you have outstanding taxes owing and you own property it is very important that you contact our offices to discuss your situation BEFORE a lien is registered.