When a taxpayer or business owes money to the Canada Revenue Agency (CRA), it may
enter into the CRA collections and enforcement process. The CRA collects for various types
of debts (personal income tax, corporate tax, GST/HST, payroll deductions, benefit
overpayments, etc.).
CRA Collections – How it Works:
- The CRA first assesses your account and issues notices or letters as reminders.
- If no payment arrangement is reached, the CRA may start legal enforcement:
- Requirement to Pay (RTP) or Enhanced Requirement to Pay (ERTP) — demands sent to
third parties (e.g. banks, employers) to garnish wages or freeze bank accounts.
- Demand on a Third Party (DTP) — a notice to a third party in possession of your funds to
remit them to CRA.
- Garnishment / seizure — CRA may garnish income (up to a limit) or freeze bank
accounts.
- Jeopardy collections — in urgent cases, CRA may take legal action immediately without
waiting for normal notice periods.
- The CRA may also offset any refunds or credit payments you are owed to cover your debt.
- The CRA has a collections limitation period: for most debts, they can collect for either 6 or
10 years from the start date, depending on the debt type.
Your Rights and CRA Collections Policy:
- The CRA publishes a Tax Collections Policy that outlines how they should act fairly,
consistently, and professionally.
- Even during collections, you have rights to be treated fairly, to negotiate, and to appeal or
object to assessments.
How eFile CRA Tax can help:
If you’re facing CRA collections or enforcement, eFile CRA Tax can assist by reviewing
notices or demands from CRA, negotiating a payment arrangement, representing you in
disputes or appeals, and guiding you to avoid garnishment or bank freezes.
