What if I don't pay the taxes owing?

If you owe taxes or other payments like a repayment of ineligible Covid benefits, then it is always recommendable to pay as quickly as possible to avoid interest accumulating. The amount owing for personal tax returns is due on April 30. If you are not able to pay the full amount you can contact the CRA to arrange a payment plan with instalments, that will fit your financial situation.

To arrange a payment plan, call this special department of the CRA:

  • From inside Canada 1-888-863-8657
  • From outside Canada 613-221-3002

If you ignore the payment requests, the CRA has incredibly strong powers to enforce further legal action. The first step is to start charging compound interest on the amount owing. The CRA will normally not start legal action until 90 days after the mailing date of the notice of assessment or reassessment.

More info also >> here <<

If you are still in Canada

If you don’t pay your debt, the CRA is legally allowed

  • to garnish up to 50% of your wages directly from the employer
  • to freeze bank accounts and make the bank pay for your debt
  • to seize and sell your belongings like car and even your home
Once the “Requirement to Pay Notice” was issued, the institution must legally comply. For example the employer must deduct the CRA debt from your pay cheque and send it to the CRA.

If you already left Canada

If you filed a tax return and have taxes owing you didn’t pay, then the CRA will first try to get the money via a collection agency. Be aware that because of a tax treaty between Canada and your home country, both financial institutions can exchange tax information. The CRA will find you through this tax treaty and arrange tax collection through the tax office of your home country.

If this option is not successful, then as the last resort the CRA will go as far as to issue a court order which will appear in the federal government systems, including the border agency CBSA. So the border agent will see the outstanding warrant for arrest for you when you try to enter.

The above situation is only the worst case scenario if you decide not to pay the money you owe to the government after you filed a tax return.

How can I pay taxes owing?

It depends if you are still in Canada or already left Canada.
You can find the payment options >> here <<