While many people find themselves in debt to the CRA every year, CRA debt is not something that should be taken lightly. If you find yourself in debt to the CRA, there are a few things you can do in order to try and rectify the situation. In this blog post, we will go over what to do if you’re in debt to the CRA, including:
- What options are available to you
- How to negotiate with the CRA
- When to seek professional help
What is CRA debt?
CRA debt is any money that you owe to the Canada Revenue Agency. This can include income taxes owed to the CRA, GST/HST, or customs duties. People often find themselves in debt to the CRA when they have not been able to pay their taxes on time, or if they have been audited and owe money as a result.
If you don’t pay your CRA debt, the CRA can take legal action against you. This can result in wage garnishment, seizure of assets, or collection through a third party. The CRA can also file a notice of lien on your property, which will negatively impact your credit score.
If you’re having difficulty paying your CRA debt, it’s important to contact the CRA as soon as possible to make arrangements. Otherwise, you could end up facing serious financial consequences.
How to know if you’re in debt to the CRA
If you’re not sure whether or not you owe money to the Canada Revenue Agency (CRA), there are a few things you can do to find out. First, check your most recent notice of assessment.
If you see any amounts owed, this is a good indication that you have a balance owing. You can also visit the CRA’s My Account service to view your account information and check for any amounts outstanding.
If you still aren’t sure, you can give the CRA a call and speak to a representative. They will be able to tell you definitively whether or not you have a balance owing and can provide more information about how to pay it off. If you are looking for a preventive measure, there are many debt tracking tools that can help you stay out of debt as well.
Technically, CRA debt forgiveness is not an option. However, there are a few different ways that you can try to negotiate with the CRA in order to come to an arrangement that works for both parties. One option is to set up a payment plan. This will allow you to spread out your payments over a period of time, making them more manageable.
If you’re not able to pay your debt in full, you can also try to negotiate a partial payment arrangement. With this type of arrangement, you would only be responsible for paying a portion of your outstanding balance. Another option is to request financial hardship assistance. This can allow you to temporarily postpone making payments or make smaller payments than what is required.
If you’re in debt to the CRA, it’s important to take action as soon as possible. The sooner you contact the CRA, the better your chances will be of negotiating a payment arrangement that works for both parties.
Keep in mind that the CRA has a number of different tools at their disposal for collecting debts, so it’s important to try and come to a resolution before things get too out of hand.