Debts owed to Revenu Québec and Revenu Canada: what are your rights – and your solutions?

By BRESSE Syndics Team | Updated: May 2026 | Reading: 7 min | Keywords: debt Revenu Québec syndic, ARC saisie salaire, dettes impôt faillite Québec, libération dettes fiscales

Revenu Québec and the Canada Revenue Agency (CRA) are not like other creditors. They have extensive collection powers – and they don’t hesitate to exercise them, often without warning. But they also have important limits. And there are legal solutions to stop their actions immediately.

Can they seize your house? Your salary? Your bank account? And most importantly: can these tax debts be erased through bankruptcy or a consumer proposal? Here are the complete, honest answers.

What Revenu Québec and CRA can do to collect your tax debts

Unlike most private creditors, the provincial and federal governments don’t need a court judgment to act. They can initiate collection action directly, quickly and without prior notice.

Seizing your salary without going to court

Revenu Québec and the CRA can send a formal request directly to your employer. Your employer is legally obliged to withhold a portion of your pay – up to 30% of your gross salary in Quebec. The seizure remains in effect until your tax debt is repaid in full.

Freeze your bank account

Governments can send a formal request to your financial institution, which is obliged to block the funds in your account. All present sums – and future inflows – may be seized. This measure can be triggered without prior notice.

Registering a legal mortgage on your property in Quebec

Revenu Québec and the CRA can register a legal hypothec on your property – whether it’s your principal residence, cottage or rental property. If you sell, the government is reimbursed from the proceeds, before you are.

Withholding tax refunds and GST/QST credits

If you are entitled to a tax refund or GST/QST credits, Revenu Québec and the CRA can automatically deduct them from your debt – without asking for your consent.

Enter your accounts receivable if you are self-employed

Governments can send formal demands directly to your customers or contractors. The latter are obliged to pay the government the sums they would have paid you – which can paralyze your cash flow overnight.

Please note: Tax debts bear interest compounded daily. Late payment penalties are added from the first day, and collection fees of 10% may be added. A $10,000 debt can easily grow to $15,000 in a few months.

What Revenu Québec and CRA can NOT do

They can no longer act once the automatic suspension has been triggered.

As soon as a bankruptcy or consumer proposal file is officially filed with an authorized trustee, an automatic suspension of proceedings comes into effect (section 69 of the Bankruptcy and Insolvency Act). Revenu Québec and the CRA must immediately cease all collection actions – on the very day the file is filed.

They cannot seize certain assets protected by Quebec law.

In Quebec, certain assets are exempt from seizure, even from the government: your furniture and essential personal effects (up to $6,000), your clothing and the tools you need for your job. Your RRSP is also protected, except for contributions made over the past 12 months in the event of bankruptcy.

Most tax debts can be discharged through bankruptcy or a proposal.

Contrary to popular belief, tax debts owed to Revenu Québec and the CRA are generally dischargeable through personal bankruptcy or a consumer proposal. This includes income tax arrears and overclaimed GST/QST credits. In the insolvency process, Revenu Québec and CRA become ordinary creditors.

What many people don’t know: The vast majority of debts owed to Revenu Québec and the CRA can be included in a bankruptcy or proposal and completely discharged at the end of the process. This is one of the most liberating revelations for our clients in Quebec City.

Which tax debts are not dischargeable?

■ Debts linked to tax fraud or proven false declarations.

■ Withholding taxes not remitted – which may engage the personal liability of company directors.

■ Court-imposed fines and penalties (common administrative penalties are dischargeable).

What do you do if Revenu Québec or the CRA has already begun to seize your your salary or assets?

Do not ignore notices and communications

A notice of assessment, a collection letter, a call from a tax agent – ignoring these communications systematically worsens the situation. Interest accrues, penalties are added, and collection actions accelerate.

Check whether a payment arrangement is possible

In some cases, Revenu Québec and the CRA agree to structure an installment plan. This option is subject to their discretion, does not suspend interest, and may not be sufficient if you have several creditors at the same time.

Consulting a licensed insolvency trustee in Quebec City – the only option offering immediate legal protection

A BRESSE trustee can analyze your entire tax situation, determine precisely which debts are dischargeable in your case, and trigger an automatic suspension that forces Revenu Québec and the CRA to cease all actions immediately – as soon as the file is filed.

Are you weighed down by a debt to Revenu Québec or the CRA? Consult a free trustee in Quebec City

You may have more options than you think. Our trustees analyze your tax file free of charge from the very first meeting.

To book an appointment: bresse.com | 1 844 890-6767

BRESSE Syndics – Licensed Insolvency Trustees – Greater Quebec City Area – 40 years of experience

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