# Liability for tax debt. Spouse incapacitated by stroke.



## ronan0 (Jul 6, 2013)

I'm wondering could posters here please help with some advice on this.

Substantial tax demands coming in the door, going back a number of years.

They are provincial Quebec taxes, personal and business (contractor).

Other spouse was unaware these taxes were owed.

No possibility of stroke victim signing or communicating anything, effects are so severe.

Questions are:

Is remaining spouse now liable for these debts?

If so, what is protected in bankruptcy proceedings? There are no real assets apart from pensions of both (very near maturity).

RRSP (from an old employer) held by stroke victim.

What is the best route to take? Authorities to contact?

Very difficult to get through to, or get much information from tax authority themselves.

Thanks for help.


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## MoreMiles (Apr 20, 2011)

ronan0 said:


> I'm wondering could posters here please help with some advice on this.
> 
> Substantial tax demands coming in the door, going back a number of years.
> 
> ...


I am so sorry to hear about your spouse. Unfortunately, Quebec is like an independent entity on its own. Unlike the rest of Canada, it requires filing provincial taxes separately because they operate their own tax laws. You need to submit 2 separate returns every year, to 2 different addresses. So most people from out of Quebec here will not be familiar enough to help you. It may mean that whatever you have to do, you have to do it twice.

Even in an unfortunate event of death, there is still a final tax return to be filed. All the debts will have to be cleared by the estate before any remaining money can be paid off as an inheritance. His pension and RRSP may be rolled over to yours if the event of passing.

With all due respect, why were you not aware of his debts? Did you two keep finances separately and hidden from each other? Unfortunately, pleading ignorance will not help much. It is my understanding that matrimonial assets are considered shared 50-50... so technically, your home is at risk too.

The best route is to hire an accountant and estate planner in Quebec. You will not get much help from the governments themselves. They generally do not help you prepare taxes. You may want to have POA and Wills prepared, if they are not done so, to avoid further delay in the event of his illness worsening.


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## AltaRed (Jun 8, 2009)

The first order of business would be to engage an experienced tax accountant (CA type) to help sort out the unpaid taxes and to answer your questions. While I am not familiar with Quebec family law and Quebec tax law, I would speculate that if it somewhat mirrors the rest of Canada, spouses ARE responsble for each other's debts. I don't think the actual RRSP/RRIF or other pension assets can be seized but I suspect the income from them can be garnished. 

I note from the OP that there is no mention of Federal tax demands... only provincial demands. Is that an oversight or intentional? Good luck.


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## MoneyGal (Apr 24, 2009)

See s.160 of the Income Tax Act, which provides that people who do not operate at arm's length from a taxpayer can be responsible for the taxpayer's unpaid income tax debts. 

CA or lawyer (preferably lawyer specializing in tax issues) should be your next step.


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## ronan0 (Jul 6, 2013)

Thank you all sincerely for advice.


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## Cal (Jun 17, 2009)

Good Luck Ronan, let us know what the accountant proposed.


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