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CRA Collections – Do they play fair? Part 2in Tax Advice Information and Updates
Now back to our story. The client got a letter shortly after the reassessment (read 7 days) which stated the following:
“Your notice of assessment showed you had a balance owing. That amount was due on the day you received the notice. Our records show that you have not yet paid this amount. The purpose of this letter is to inform you that if your outstanding balance remains unpaid, we may take legal action against you. This could include garnishing your income or bank account, or seizing and selling your assets”
Legal action?! Really?!
If you had not read above, where I told you your rights, would this type of wording scare the hell out of you? If I did not know what I know, it would have scared me. Problem is that CRA cannot start legal action until the 90 day appeal period is up, and they cannot take legal action if the amount is under objection or appeal. This means if you send in an appeal or are going to send one in then they have to back off. Funny how the CRA forgot to mention those facts in the letter. If this is not fear mongering, then I don’t know what is. I mean you don’t suppose that they are deliberately trying to scare people, do you? As Arsenio Hall use to say “kinda makes you go hmmmmmm, doesn’t it? In the past, there used to be a paragraph telling you that if you are appealing then you have the choice whether to pay or not, but interest will continue to accumulate. At least they used to inform you of your rights.
Any way, now you know. Make sure you know your rights. Don’t trust anyone else to look out for your best interest. Above all else, DO NOT TRUST THE CRA TO TELL YOU YOUR RIGHTS. After all, they are on the CRA website so technically they have told you, right (insert sarcastic eye roll here)?
Last thought, if you want to read for yourself check out Information Circular 98-1R3 – Collections Policy. It is always best to get things from the source. CRA website: www.cra.gc.ca