Corporate Law

Director's Liability for Tax Debts

The CRA can pursue directors personally for corporate tax debts like unremitted payroll taxes and GST/HST. When a Director’s Liability Assessment is issued, the financial consequences can be significant.

Due Diligence Defense

To defend against liability, a director must show they exercised the degree of care, diligence, and skill that a reasonably prudent person would have exercised in similar circumstances to prevent the failure to remit.

  • Assessing personal exposure and risk
  • Responding to CRA pre-assessment letters
  • Challenging Director’s Liability Assessments
  • Asserting due diligence defenses
  • Negotiating settlements and payment arrangements

Personal Liability Risk

Directors can be held personally liable for:

• Unremitted payroll deductions (CPP, EI, tax)
• Unremitted GST/HST
• Related interest and penalties
• Debts remaining after corporate dissolution

Protect Your Personal Assets

If you are a current or former director of a corporation with outstanding tax liabilities, do not ignore CRA correspondence. Early legal advice is essential to protecting your personal assets and rights.