What Should You Do if the Canada Revenue Agency Demands Payment?
It’s usually a scary situation when the Canada Revenue Agency (CRA) contacts you demanding payment. There are many reasons why. One is that, if they’re getting in touch to ask for money, it might be a lot of money and, possibly, a lot of money that you don’t have. This situation would be worrying no matter who was asking for money, but, if it’s the CRA, the situation can be a lot more intimidating.
One reason is why is because the CRA is very difficult to communicate and negotiate with. Those working for the agency are very experienced and know that their position is a powerful one. Unlike other debt collectors, the CRA has very strong powers to collect the money is that owed to them.
Your best option if the CRA contacts you and states that you owe tax money is to pay your debt in full as soon as possible. You can also file an objection if you believe that the CRA is wrong in its assertion that you owe money. However, if you do owe and you’re not able to pay, there are some steps you can take.
Negotiating with the CRA
As mentioned, CRA negotiators are experienced and it is very difficult to negotiate with them. If you can prove that paying your debt in full is not financially possible for you, they may agree to a payment plan. However, before they do this, they will want to see all of your financial records, such as the details of your income, your expenses, your assets, and your debt. While this may seem reasonable at first, it’s important to keep in mind that the CRA wants the money owed to it first, over all other financial obligations. Agreeing to the CRA’s terms could put you in a tight financial situation where you will no longer be able to meet your other financial commitments.
Don’t Ignore the CRA
One thing that you should not do if the CRA contacts you demanding payment is ignore them. You might think that avoiding letters and other forms of communication with the CRA will cause them to forget about you, but this does not happen. If you owe the CRA money and refuse to communicate with the agency, a number of things may happen.
The CRA can, and will, continue to charge interest on your outstanding debt. Depending on how much you owe, these interest charges could be considerable. However, as mentioned, the CRA also has considerable collection powers that can cause you significant financial harm.
For example, if you don’t pay and/or cooperate with the CRA, it can garnish your wages, seize your assets, freeze your bank accounts, and much more. Rather than potentially deal with these very serious consequences, contact our team today at 1-888-868-1400 to discuss your situation and find out how we can help.