Canada Revenue Agency CollectionOver the past few years, the Canada Revenue Agency (CRA) has made great strides in training its collection agents in deploying different methods to collect money from taxpayers. The tactics they deploy will depend on how strong their position is.

If they know what you own, where you work, or where you bank, they will simply refuse to negotiate with you and begin seizing your assets or garnisheeing your wages. However, if they are unsure about what they know, or feel as though other relevant information could improve their ability to collect, this is when the games will begin. We use the word “game” but not in the fun sense.  Put more bluntly they are CRA tactics (or tricks) to get you to disclose the information they need, essentially making you your own worst enemy.

Good Cop/Bad Cop – This is played out in two ways.  In the first method the Good Cop contacts you and you think “wow! I got really lucky – this CRA person is so helpful and polite. No pressure. They are telling me I can get payment terms but to get me approval for this they need financial disclosure. Ok.” So most people simply give the information because they believe this is needed to get treated fairly.  Then the file gets transferred.  The Good Cop no longer has your file.  The Bad Cop is aggressive and tells you to pay them in full – in some impossibly short time frame (like next week).  With all the information you gave the Good Cop, the Bad Cop can quickly proceed to attack you by freezing bank accounts and retirement plans, garnisheeing your income and registering liens on your home and vehicles.  Remember, the Bad Cop does not need a Court Order or even to provide you with a warning.  He has legislated powers to just swoop in and collect.

Another way this is played out is that the Bad Cop gets to you first and is so aggressive with you that they push you to the brink and you stop returning their calls or perhaps you just hang up on them. One collector will terrorize you and then when you are at your weakest, the next will come in like your best friend. In an attempt to garner some relief, you may try to work with the ‘nice’ collector only to see them remove their mask and reveal their fangs once you have disclosed personal information to them in the hopes of a payment plan. This will lead to face enforcement action, bringing us to the next tactic….

Financial disclosure forms – this is when CRA indicates they will accept a short term payment plan from you in exchange for proof that you can’t pay in full. They will send you a financial disclosure statement and ask you to disclose your income source and assets. When the short term payment plan expires (or you miss a payment) CRA now has all the information it needs to attack you if you will not pay according to their demands (rather than what you can fairly afford).  OR CRA decides that based on your financial disclosure that they feel you can pay more or pay in full.  At this point they will renege on the payment plan and come after you.

No matter how nice your CRA collector is, they are not your friend! They don’t feel sorry for you and you don’t sign their paycheques. They have one mandate and that is to close their file. Their file cannot be closed unless you pay in full or are bankrupt.

This does not mean that an arrangement can’t be made with CRA that is fair and reasonable? It is possible to negotiate a realistic payment plan, but unless you are a skilled negotiator with many years of experience dealing with CRA collectors, trying to do so could put you in worse shape.

The best thing to do is get informed, do your research and talk to professionals who know how to deal with CRA. Some important strategies when dealing with CRA include never giving CRA cheques on your bank account – pay by money order or credit card – and never just giving up a financial disclosure statement. Always beware, when faced with collections action by CRA, of the good cop/bad cop tactics.

For more information about how to get a payment plan in place with CRA visit or call 1-888-868-1400.