Canada’s Excise Tax Act gives sweeping powers to the Canada Revenue Agency (“CRA”), and by extension its tax collection officers, to collect the tax debts of taxpayers. In many cases, taxpayers are taken by surprise when their bank accounts are frozen, assets liened or seized and wages garnisheed. However there are certain limitations on when the CRA can legally take action to collect GST/HST tax debt, which are both situational and based upon strict timeframes. Unlike most debts under the Income Tax Act, there is no initial 90 day period where collection action is barred after a GST/HST assessment. There is however a 10 year limitation period that applies to GST/HST tax debts. This limitation period is ‘restarted’ whenever the CRA takes action to collect the debt or the taxpayer acknowledges the tax debt, which can mean that a GST/HST debt more than 10 years old is still collectible. If you need help dealing with CRA tax collectors, one of our expert Canadian GST/HST tax lawyers can help.
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