If you’ve received a garnishment notice from the Canada Revenue Agency (CRA), you’re not alone—and you’re not out of options.

Garnishment is one of the tools the CRA uses to collect unpaid tax debt. When it happens, the CRA contacts your employer and instructs them to withhold part of your paycheque to apply against what you owe. It can be shocking and stressful, but here’s the good news: there are steps you can take to stop the garnishment and get your finances back on track.

Step 1: Don’t Ignore It—Contact the CRA

As soon as you receive a notice, contact the CRA. Ask what needs to happen to lift the garnishment. In most cases, this involves:

  • Filing any outstanding tax returns, and/or

  • Setting up a payment plan.

Learn more: What to do when you get a letter from CRA

Step 2: File Any Missing Tax Returns

Even if you can’t pay what you owe, filing your returns is critical. Why? The CRA may have issued what’s called a notional assessment—an estimate of your taxes owing that could be much higher than what you truly owe. By filing, you might actually reduce your tax debt.

Learn more: Why you should file your old tax returns

Step 3: Set Up a Payment Plan

The CRA offers standard payment plans (usually over 6 months), but if that’s not feasible, you can request taxpayer relief to extend the timeline. Make sure to explain your financial situation clearly when applying.

Step 4: Explore a Consumer Proposal (If Needed)

If your debt is too large to manage, you may want to speak with a Licensed Insolvency Trustee. A consumer proposal can help you consolidate and reduce the total amount owed—including amounts owing to the CRA.

Troubles with CRA? Reach out today to see if Personal Tax Advisors can help.