CRA garnishments come into effect when there is a substantial tax debt due to them without any proposal from the taxpayer in the form of a payment plan. If the tax returns have not been filed and CRA feels that there is no likelihood from a particular taxpayer to come forward with any voluntary disclosure, you can expect CRA garnishments. This scenario is also quite possible if the CRA has a motive to belief that a particular taxpayer is not in a position to pay the tax amount. The CRA will then would have assessed that taxpayer by means of a notional assessment.
CRA does not require a court order to impose a wage garnishment unlike all other creditors. CRA garnishments can simply happen without any kind of warning and they can bring with them considerable financial distress. CRA garnishments can be applicable for up to fifty per cent of your income if you are in service and have made arrangement for tax deduction at source. If you add other sources of income such as earnings from sub-contractors, your income can be up for garnish in its entirety.
There are other types of CRA garnishments that can be imposed on individuals who are self-employed. CRA will even send a notice to the clients of a particular business and make sure that the payments for invoices are re-directed to the Agency and it can go ahead and garnishee up to one hundred per cent of the invoice payments that are due to you.
Thousands of CRA garnishments get instated every year and it is foolhardy to presume that you may be spared. It is embarrassment at the last minute if you do not caution your employer as he or she may get a directive from the CRA to freeze your wages. When the employer receives a notice directly from the CRA, he or she then becomes obligated under law to have your wages garnished.
When you get a notice that your earnings are likely to be garnished, you have to take quick action and get in touch with the tax professionals who can assist you and guide you properly as these experts have many years of experience behind them. They have always been dealing with numerous CRA issues and that include garnishments. These consultancy firms will come in handy during the troubled times for your tax matters.
A wage garnishment is an act when the employer of a taxpayer turns over a part of his or her wages to the CRA. The issue of garnishment comes about when there is usually an extensive tax debt owed by a particular taxpayer and when the CRA feels that the taxpayer would be unwilling to pay the tax dues.
When you get a feeling that your income has been garnished unfairly, then it is about time that you consult some tax professionals to help you out in your tax issues.