If you cannot pay in full now

Video series: Debt Collection at the Canada Revenue Agency (CRA)

If you cannot pay the full amount you owe now, take action by contacting the Canada Revenue Agency (CRA) right away. Ignoring your debt does not make it go away. In fact, waiting may make any financial or legal consequences more serious.

The CRA may also charge interest compounded daily at the prescribed rate on any amount owing until your balance is paid in full.

The CRA will work with you to resolve your tax debt or other government programs debt. You may qualify for one of the options below that help individuals and businesses meet their payment responsibilities.

You cannot pay your individual tax debt in full now

If you cannot pay your individual tax debt in full now, you may qualify for a payment arrangement or ask for taxpayer relief.

Payment arrangements

A payment arrangement is an agreement you make with the CRA. It allows you to make smaller payments over time until you have paid your entire debt including applicable interest.

Before you make a payment arrangement, you may need to show that you have tried to pay your debt in full by borrowing money or reducing your expenses. To figure out your ability to pay, we may ask you to provide proof of your income, expenses, assets, and liabilities. You may have to do this by telephone or by completing a financial questionnaire.

Note

We will never request this information by email. (See protect yourself against fraud for more information.)

If you miss a payment or have any unfiled tax returns, we may cancel the payment arrangement and take action to recover your debt.

There are three ways you can set up a payment arrangement.

Pre-authorized debit

Paying online is one of the fastest and easiest ways to set up a payment arrangement. You can do this using Pay by pre-authorized debit through My Account. In most cases, you can make the arrangement on your own without speaking with the CRA.

TeleArrangement

You can make a payment arrangement through our automated TeleArrangement service by calling 1-866-256-1147. TeleArrangement is available Monday to Friday, 7:00 a.m. to 10:00 p.m., Eastern time. To use this service, you will need to provide:

  • your social insurance number
  • your date of birth
  • the amount entered on line 150 from your last assessed return

Speak with an agent

Receive a call from a CRA call centre agent by completing an Individual tax debt call request or call 1-888-863-8657.

If you have other questions about your individual account, please call the individual income tax enquiries line at 1-800-959-8281.

Taxpayer relief provisions for individuals

In some circumstances, you may be able to ask for relief from penalties and interest charges and reduce the overall amount you or your business owes. For more information, and to see if your situation qualifies, see Taxpayer relief provisions.

Insolvency or bankruptcy

If you feel you are insolvent or are considering bankruptcy, visit the Office of the Superintendent of Bankruptcy for more information.

Your business cannot pay its tax debt in full now

If you are an employer, the amounts that you deduct and withhold from the wages of your employees are considered deemed trust amounts. Similarly, if you operate a business as a sole proprietor, partnership, or corporation, the GST/HST amounts that you collect from your customers are also considered deemed trust amounts.

If your business has a tax debt, it may include corporate income tax debt and deemed trust amounts.

You cannot use deemed trust amounts as cash flow. Even if you keep these amounts with your personal or business funds, the amounts are considered to be held separate and apart. Deemed trust amounts must be paid in full when owed.

The CRA will work with businesses to help them meet their payment obligations, such as corporate income tax debt or deemed trust amounts. In extraordinary situations where your business cannot pay in full, you may qualify for a payment arrangement or taxpayer relief.

Payment arrangements

A payment arrangement is an agreement that your business makes with the CRA. It allows your business to make smaller payments over time until you have paid your entire debt including applicable interest.

Before your business makes a payment arrangement, you may need to show that you have tried to pay your debt in full by borrowing money or reducing expenses. As a business, you may also have to fully disclose your financial records.

Note

We will never request this information by email. (See protect yourself against fraud for more information.)

Once you have made a payment arrangement your business must also

  • maintain a regular payment plan
  • always file all returns on time
  • stay up to date with tax obligations

If you fail to do any of these things, we may cancel the payment arrangement and take action to recover the debt.

There are two ways you can set up a payment arrangement.

Pre-authorized debit

Paying online is one of the fastest and easiest ways to set up a payment arrangement. You can do this using Pay by pre-authorized debit through My Business Account. In most cases, you can make the arrangement on your own without speaking with the CRA.

Speak with an agent

Receive a call from a CRA call centre agent about paying your business tax debt by completing a:

If you have other questions about your business account, please call the business and self-employed individuals enquiries line at 1-800-959-5525.

Taxpayer relief provisions for businesses

In some circumstances, you may be able to ask for relief from penalties and interest charges and reduce the overall amount you or your business owes. For more information, and to see if your situation qualifies, see Taxpayer relief provisions.

Insolvency or bankruptcy

If you feel you are insolvent or are considering bankruptcy, visit the Office of the Superintendent of Bankruptcy for more information.

You cannot pay your other government programs debt in full now

The CRA collects amounts owed for other government programs. For a list, see debts the CRA collects.

If you cannot pay your other government programs debt in full now, you may qualify for a payment arrangement or for help under the financial hardship provisions.

Payment arrangements

A payment arrangement is an agreement you make with the CRA. It allows you to make smaller payments over time until you have paid your entire debt including applicable interest.

Before you make a payment arrangement, you may need to show that you have tried to pay your debt in full. This could include rearranging your financial affairs.

If the CRA determines that you cannot pay in full, we can work with you to make a plan to pay your debt. To figure out your ability to pay, we may ask you to provide proof of your income, expenses, assets, and liabilities. You may have to do this by telephone or by completing a financial questionnaire.

Note

We will never request this information by email. (See protect yourself against fraud for more information.)

If you miss a payment, we may cancel the payment arrangement and take action to recover your debt.

Speak with an agent

Receive a call from a CRA call centre agent by completing a government programs debt call request or call 1-866-864-5823.

Financial hardship provisions

If your debt repayment makes it difficult for you to pay for housing, food, utilities and other necessities of life, you may qualify for help under the financial hardship provisions.

It is your responsibility to contact the CRA if repaying your debt is causing you financial hardship. The CRA will take your situation into account when reviewing your request.

For more information and to see if you qualify, call 1-866-864-5823

Insolvency or bankruptcy

If you feel you are insolvent or are considering bankruptcy, visit the Office of the Superintendent of Bankruptcy for more information.

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