I Owe Money to the CRA – What do I do?
So you filed a personal, corporation, or GST/HST return but you weren’t able to cover the balance owing to the Canada Revenue Agency (“CRA”). What now?
This is the same question faced by tens of thousands of Canadians everyday. You have options, but you also need to know what the CRA can do in order to collect the amount owing.
If you cannot afford to pay off your back taxes, you can attempt to get yourself on a payment plan with CRA. CRA’s position is always that you should pay them off first, prior to any other creditor. It can be very difficult to negotiate a payment arrangement with someone who wants you to incur credit card interest at a rate of 20% just so your debt to them can be paid off faster.
Rosen Kirshen Tax Law specializes in tax dispute resolution, which includes negotiating payment plans with CRA collections officers. We know your rights and we also know the CRAs code of conduct, which we use to get you on a payment arrangement that suits your current financial abilities.
Call us today to discuss getting you on a payment arrangement so you no longer have to worry about legal action being taken against you.
What can the CRA do to me?
If you owe CRA, and you are not making payments, they will come after you, your family, and your business. They start by garnishing your wages, or receivables and freezing your bank account. They then take the money out of your account but they don’t release it! They continue to hold your bank account basically trying to make sure you can’t put food on the table, or keep the lights on.
If that isn’t enough, they can seize your assets, put a lien on your home / property, and eventually force the sale of your home / property.
Interests and Penalty
If you file a tax return late, you are immediately hit with penalties, and then interest on top of those penalties. A debt of $10,000 can easily balloon to $20,000 in a matter of minutes.
CRA continues to charge interest on your debt at a rate of 5% compounded daily. This works out to about 7.1% of interest being charged to you every year! CRA even charges interest on top of interest!
If you are in a situation that feels like you have no escape, you might want to look into the Taxpayer Relief Program, and you should give us a call today!
Taxpayer Relief Program
Taxpayers have the ability to apply for the removal of penalties and interest charged to them over the previous 10 years. CRA has strict guidelines about what type of scenario qualifies for taxpayer relief. If you are drowning in interest and penalties, you need to look into this program, and call us to get started!
Handling CRA debt can be extremely stressful for you, your business, and your family. Rosen Kirshen Tax Law takes over for you, so you no longer have to stress about how to deal with CRA collections. Call us today, and rest easy knowing your debt is in the right hands.
This article provides information of a general nature only. It does not provide legal advice nor can it or should it be relied upon. All tax situations are specific to their facts and will differ from the situations in this article. If you have specific legal questions you should consult a lawyer.