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The title is catchy. But it may raise several preconceived and erroneous notions — we hear all sorts of things about this during the first meeting. That’s why some explanations are necessary. While this isn’t legal advice, it can help people who owe money to governmental agencies to make the right, well-informed decision to solve their problem. In some cases this can end their debt problem.

We’ll address the most common types of debt. For more detailed information, it’s always better to consult a Ginsberg Gingras licensed insolvency trustee who can guide you in resolving your problem.

Income tax debt for individuals

An amount due for income taxes owed by individuals is a type of debt that can be included in a bankruptcy or consumer proposal, they will be erased afterward.

GST/QST (HST in other provinces)

These amounts are dealt with in the same way as are income tax debts for individuals.

Amounts owed to Service Canada

Amounts due because of overpayment of Employment Insurance will not be erased, but Service Canada may not exercise its right to seizure during a bankruptcy or consumer proposal.

Student loans

Amounts owed for financial aid for education: there’s a difference between support granted by a government and a similar product offered by a financial institution. Since each case may be different, consult with a trustee who will be able to understand the differences and tell you what will happen with the debt, and your options.

Social assistance

Social assistance creates more than one kind of debt. They include overpayments, debt amounts determined from joint liability and debt following a sponsorship. An overpayment will not be erased, but as for Employment Insurance, no seizure of salary or goods will be carried out during a bankruptcy or a consumer proposal.
In order to determine if a bankruptcy discharge, or completion of a consumer proposal will have an effect on a government debt, consult a Ginsberg Gingras licensed insolvency trustee. Consultation is free and without any obligation. You can meet virtually or in person.

Ginsberg Gingras, serving you for 40 years. Discretion assured.

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