2012-11-29
Yes, they are released in a bankruptcy, or consumer proposal for that matter.
Many people are confused about this issue primarily, I think, because they have read websites relating to bankruptcy proceedings in the USA where income tax debts are generally not released. In Canada all debts that a person owes are released in a bankruptcy with the exception of a very few specifically listed types of debts (alimony and child support, fines and penalties imposed by a court etc.). Income tax (and generally debts due to the government) are not specifically listed and they ARE therefore released.
I should also note that there is no authority under the Income Tax Act for CRA to settle a debt for some lessor amount but we can, and do, settle debts owing to CRA through Consumer Proposals Frequently. Please do not hesitate to call me at 306-790-7904 if you would like further information or wish to discuss.
2025-11-07
Bankruptcy Consumer Proposal
If you're facing a mountain of debt, you're not alone. There are two viable options available to help you find relief: Consumer Proposal and Bankruptcy. Each approach offers unique benefits that can be tailored to fit your specific financial situation.
2025-11-06
Filing for bankruptcy doesn’t mean losing everything. Learn which assets are protected in B.C. and how to move forward with a fresh financial start.
2025-11-05
Debt Solutions
Unexpected tax debt can be a daunting prospect. How can you confirm the CRA is really calling you — and pay back what you owe?
