You are deregistering your GST/HST account because of a bankruptcy

Bankruptcy is a legal process by which you may be discharged from most of your debts. The purpose is to permit an honest, but unfortunate debtor to obtain a discharge from debts, subject to reasonable conditions. Usually, the Business Number (BN) of a bankrupt client will be closed after discharge.

There are three different ways to go into bankruptcy:

• voluntary assignment - where insolvent persons make an assignment of all their assets for the general benefit of all creditors;
• involuntary assignment - when a creditor files a petition in a provincial court for a receiving order against the debtor's assets, known as being petitioned into bankruptcy; and
• deemed bankruptcy - when a proposal in bankruptcy pursuant to the Bankruptcy and Insolvency Act has failed.

You have to send a copy of the court issued Assignment in Bankruptcy, a Bankruptcy Notice, or correspondence entitled First Meeting of Creditors to your tax services office.

Continuing in business after Assignment in Bankruptcy

You (as the bankrupt) have the right to earn a living. For this purpose, you are allowed to engage in or continue a business activity outside of the estate, following a bankruptcy.

If you wish to continue in business, you will be considered a new entity beginning on the day after the assignment into bankruptcy. You will require a new BN and GST/HST account.

The four consecutive calendar quarters used to determine the $30,000 small supplier threshold for mandatory registration begins on the day immediately after the assignment into bankruptcy. If you must be registered immediately (such as a taxi driver) or you wish to register voluntarily, a new registration will be established.