Knowlopedia
Valued Contributor
Tax arrears can be a difficult financial burden to bear, but there are strategies you can use to pay them off.
One of the most important things to do is to contact the Canada Revenue Agency (CRA) as soon as possible. They may be able to work with you on a payment plan that fits your budget and timeline. You should also make sure that you understand what taxes you owe and why, so that you can avoid any future issues with the CRA.
If your tax arrears are too large for you to pay off in one lump sum, consider using debt consolidation services or a loan from a bank or credit union. This will allow you to combine all of your debts into one manageable payment each month. However, it’s important to remember that these loans come with interest rates and fees, so make sure that they won’t add more financial strain than they relieve.
You may also want to consider selling some assets or taking on extra work in order to generate additional income for paying off your tax arrears. Selling items such as cars or furniture can provide an immediate influx of cash which could help reduce your debt quickly and efficiently. Taking on extra hours at work or finding freelance jobs online are other options for generating additional income over time.
Lastly, if none of these strategies seem feasible for your situation, it might be worth considering filing for bankruptcy protection from creditors who are trying to collect unpaid taxes from you. Bankruptcy will stop any collection attempts by creditors while giving you time and space needed to reorganize your finances and get back on track financially without worrying about tax arrears looming over your head every day.
One of the most important things to do is to contact the Canada Revenue Agency (CRA) as soon as possible. They may be able to work with you on a payment plan that fits your budget and timeline. You should also make sure that you understand what taxes you owe and why, so that you can avoid any future issues with the CRA.
If your tax arrears are too large for you to pay off in one lump sum, consider using debt consolidation services or a loan from a bank or credit union. This will allow you to combine all of your debts into one manageable payment each month. However, it’s important to remember that these loans come with interest rates and fees, so make sure that they won’t add more financial strain than they relieve.
You may also want to consider selling some assets or taking on extra work in order to generate additional income for paying off your tax arrears. Selling items such as cars or furniture can provide an immediate influx of cash which could help reduce your debt quickly and efficiently. Taking on extra hours at work or finding freelance jobs online are other options for generating additional income over time.
Lastly, if none of these strategies seem feasible for your situation, it might be worth considering filing for bankruptcy protection from creditors who are trying to collect unpaid taxes from you. Bankruptcy will stop any collection attempts by creditors while giving you time and space needed to reorganize your finances and get back on track financially without worrying about tax arrears looming over your head every day.
