How to process a garnishment from the CRA

You may have received a request from the Canada Revenue Agency (CRA) to garnish a taxpayer’s income or a business's bank account. It is important that you follow the instructions on the document. On this page, you will find more information about your responsibilities.

What garnishments are: RTPs, ERTPs, and DTPs

When we are unable to collect an amount owing or make an arrangement with the taxpayer to pay their debt, we may request funds from a third party. You may be identified as a third party if you owe (or will owe) money to a taxpayer or if you hold money for them. A third party could include a person or organization such as an employer or financial institution, or another source of income.

We send requests (called garnishments) as one of the following legal documents:

• Requirement to pay (RTP)
• Enhanced requirement to pay (ERTP)
• Demand on a third party (DTP)

A garnishment tells you (a third party) that some or all money you normally pay to, or hold for someone who owes a debt to the government, is now payable to the CRA, Employment and Social Development Canada (ESDC), or Canada Border Services Agency (CBSA).

Differences between RTPs, ERTPs and DTPs

Differences between RTPs, ERTPs and DTPs

	RTP	ERTP	DTP
Types of debt collected	Income tax Corporate tax Payroll deductions GST/HST remittances Customs duties, taxes, and others COVID-19 benefits and subsidies	Payroll deductions GST/HST remittances Air Travellers Security Charge (ATSC)	Government programs such as: Employment Insurance Canada Pension Plan Canada Student Loan
Priority over other creditors	Takes priority over most creditors (except secured creditors)	Takes priority over the interests of secured creditors	Takes priority over most creditors (except secured creditors)
CRA's legal requirement	No court order required (exception: required for COVID-19 benefits for individuals)	No court order required	May need a provincial judgement or a certificate from the Federal Court

Types of payments we can request

A garnishment can apply to different types of payments, such as:

• Salary, wages, commissions, bonuses
• Money held at a financial institution
• Reimbursement of expenses owed to an employee
• Rent or lease payments
• Loans made by a corporation to a taxpayer, when the corporation is not dealing with the taxpayer at arm’s length (refer to Income Tax Folio S1-F5-C1, Related Persons and Dealing at Arm's Length)
• Annuity, interest, dividends and other investment proceeds
• Accounts receivable
• Proceeds of an insurance claim

If you receive a garnishment

You must comply when you receive a garnishment. The person or business who owes the debt can't go after you for the amounts sent to us.

We send a copy of the garnishment to the person or business who owes the debt at the same time we send it to you. The amount you owe the taxpayer is reduced by the amount you send to us.

If you are having difficulty identifying the person

Call the contact number listed on the garnishment right away.

If you owe money to the person and payment is due

Deduct the amount according to the instructions on the garnishment and send it to the address indicated on the document right away.

If you don't owe money to the person

1. Keep a copy of the garnishment because you may owe money to the taxpayer in the future.
2. Call the contact number listed on the garnishment, or return the completed response form to explain why you won't be making a payment.

If you owe money to the person but they no longer work for you

RTP or ERTP

You have to send us money from the employee's final pay. You will find instructions on the first page telling you how much to send.

DTP

1. Deduct 30% (even if it was for a different percentage or amount) of the net pay up to the amount owed.
2. Fill out the section of the document explaining why this is the final payment and that you can't comply with the full demand.
3. Mail the payment with the form to the address on the document.

If the person claims to have made arrangements with the CRA

You must comply with the garnishment, unless we tell you in writing that it has been withdrawn.

If you are already sending money for a garnishment received for another creditor

You must comply with the garnishment. If there isn't enough to pay the other creditor and the CRA’s garnishment, call our contact number listed on the document right away.

Our policy gives priority to any competing child support garnishment. If you can't reach anyone at the contact number on the document:

• For RTP and ERTP, call 1-800-675-6184
• For DTP call, 1-800-661-5991

If the person has filed a proposal or filed for bankruptcy

If you receive a phone call from a trustee, continue to honour the garnishment request until you receive written confirmation of the insolvency filing.

Call our contact number listed on the document before you take any action. In some instances, the money owed to the taxpayer belongs to the CRA, ESDC or CBSA. If you distribute any money, you may become liable.

If you loan or advance money to a non-arm's-length person or entity within 90 days from the date you receive the RTP or ERTP

You are required to send the money to us. For more information, see Income Tax Folio S1-F5-C1, Related Persons and Dealing at Arm's Length.

If you don't comply with a garnishment

You become liable for the amount you didn't pay to us (up to the full amount of the garnishment). We may take action to collect that amount from you.

You become liable if you:

• Do not pay us when you owe money to the person who owes the debt
• Continue to pay the person amounts you are legally required to pay to us
• Pay someone else on behalf of the person, such as a relative or another creditor instead of us
• Loan or advance money to the person within 90 days from the date you receive the garnishment, if the specific term is included on the RTP

How much you must pay

The first page of the garnishment shows the maximum amount you must withhold from the person and send to us. Send this amount to the CRA, ESDC or CBSA (as specified on the request) for every payment you owe them unless the document instructs you to withhold one of the following:

• A fixed amount from each payment
• A fixed amount from all amounts paid in a set time period, such as a month
• A percentage from each payment

Continue to withhold and send these amounts to us during the effective period of the garnishment request, or until the total you have sent equals the maximum amount requested.

In some cases, the garnishment may instruct you to send all amounts upon termination of employment.

If you have miscalculated your payments and paid more than you were required to pay, contact us at the number listed on the document.

How to pay

Payments may be payable to the CRA, ESDC or CBSA. The garnishment will tell you who and where to send your payment to.

Remember to:

• Write the account number from the remittance form on the front of your cheque or money order
• Make your cheque or money order payable to the Receiver General for Canada
• Mail the remittance form, with your cheque or money order, to the address listed on the remittance form
• Keep a record of the amount and the date of your payment

If you sent a payment and then received a withdrawal of the requirement to pay, contact us at the number provided on the notice.

Validity period

You will find the terms and effective period on the first page of the garnishment. Generally, it will be valid for one of the following time periods:

• 90 days
• 1 year
• Until the debt is paid in full

Some exceptions may apply.

Keep a copy of the garnishment for the entire period it is in effect and for at least one year after receiving it, as you may owe amounts to the person in the future.

Your obligation ends after one or more of the following situations happens:

• You no longer owe amounts to the person, and no other amounts become owing during the effective period of the garnishment
• You sent money to us totalling the maximum amount shown on the garnishment
• You receive a letter from us indicating the garnishment is no longer in effect
• The RTP or ERTP expires and is no longer valid

Contact us about a garnishment

If you need more information about an RTP, ERTP or DTP you received, call the CRA contact person at the telephone number listed on the document.

If you can't reach anyone at the contact number on the document:

• For RTP and ERTP call 1-800-675-6184
• For DTP call 1-800-661-5991