Here's what to do if you can't pay your Canadian taxes this year

It’s been a difficult 14 months for Canadians financially and the Canada Revenue Agency (CRA) is highlighting what anyone struggling with tax payments can do.

The CRA says there are ways to pay your tax debt based on your financial situation.

“We know these are still challenging times,” says the federal agency. “Let’s work together to determine what your options are.”

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The CRA says there are several payment options if you can’t pay your tax debt in full:

Partial payment

You can make partial payments to the CRA to reduce the amount of interest you need to pay on unpaid amounts. (To see all the payment options or to make a partial payment, go to canada.ca/payments)

Payment arrangement

If you can’t afford to pay your taxes in one payment, you might be able to set up a payment arrangement with the CRA. A payment arrangement is a mutual agreement between you and the CRA, allowing you to spread out your payments over time, based on your ability to pay, until you have paid your debt and interest in full.

The CRA says it will work with you to schedule payment arrangements, but Canadians can also apply credits or refunds towards outstanding debt to help with outstanding owing amounts.

TeleArrangement service
Canadians can also make a payment arrangement by calling the CRA’s automated TeleArrangement service (1-866-256-1147) and will need to supply:

• social insurance number
• date of birth
• the amount on line 15000 of your last notice of assessment

The TeleArrangement service is available Monday to Friday, from 7 am. to 10 pm ET.

Pay by pre-authorized debit
You can authorize the CRA to withdraw a certain amount directly from your bank account, on dates of your choosing, through one of the CRA’s following online services:

• My Account
• My Business Account
• MyCRA mobile web application

What to do for people who can’t pay

The CRA says “communication is key” when it comes to people who are unable to pay their tax debt in full and says taxpayers must tell the agency “as soon as possible so that we can work with you to determine a feasible payment arrangement.”

According to the feds, interest compounds daily at the rate set by law until you pay the amount you owe in full.

More information for people who owe money can be found on the CRA website.