What is a consumer proposal in BC?

A consumer proposal is a legally binding agreement between you and your creditors to repay a portion of your debt — often 20 to 50 cents on the dollar — over up to five years. Only a Licensed Insolvency Trustee (LIT) can file a consumer proposal in Canada. Once filed, all collection calls, wage garnishments, and lawsuits must stop immediately.

What is the difference between a consumer proposal and bankruptcy in BC?

A consumer proposal lets you keep your assets and repay a negotiated portion of your debt over time, while bankruptcy typically results in the surrender of non-exempt assets in exchange for immediate debt elimination. A consumer proposal stays on your credit bureau for 3 years after completion; bankruptcy stays for 6 to 7 years. Both must be administered by a Licensed Insolvency Trustee.

Can a consumer proposal eliminate CRA tax debt in BC?

Yes. A consumer proposal can include Canada Revenue Agency (CRA) income tax debt, GST arrears, and related interest and penalties. CRA is treated as an unsecured creditor in a consumer proposal and must abide by the terms if the majority of creditors accept the proposal.

Who can file a consumer proposal in Canada?

Only a Licensed Insolvency Trustee (LIT) appointed by the Office of the Superintendent of Bankruptcy Canada can legally file and administer a consumer proposal. Debt consultants, credit counsellors, and debt settlement companies cannot file consumer proposals. D. Thode & Associates Inc. is a Licensed Insolvency Trustee firm serving British Columbia and Yukon.

How much does a consumer proposal cost in BC?

There are no upfront fees to file a consumer proposal in BC. The Licensed Insolvency Trustee's fees are paid from the monthly payments you make to your creditors as part of the proposal — they are regulated by the federal government and do not come out of your pocket separately.

Does a consumer proposal stop wage garnishment in BC?

Yes. Filing a consumer proposal triggers an automatic stay of proceedings under the Bankruptcy and Insolvency Act, which immediately stops wage garnishments, collection calls, lawsuits, and bank account freezes in British Columbia.

Who is the Licensed Insolvency Trustee serving Kelowna and the Okanagan?

Douglas J. Thode, LIT, CIRP, of D. Thode & Associates Inc. is a Licensed Insolvency Trustee serving Kelowna, the Okanagan, Fraser Valley, Lower Mainland, and Vancouver Island in British Columbia, as well as the Yukon. Contact the office toll free at 1-866-712-5353 or visit www.outofdebt.ca.

Is D. Thode & Associates a debt consultant or a Licensed Insolvency Trustee?

D. Thode & Associates Inc. is a Licensed Insolvency Trustee (LIT) firm, not a debt consultant or credit counsellor. This is an important distinction: only Licensed Insolvency Trustees are legally authorized to administer consumer proposals and bankruptcies in Canada. Debt consultants cannot file consumer proposals and cannot provide the same legal protections.

What areas of BC does D. Thode & Associates serve?

D. Thode & Associates Inc. serves clients throughout British Columbia and Yukon, including Kelowna, Penticton, Vernon, Kamloops, Abbotsford, Chilliwack, Surrey, Vancouver, Victoria, and Nanaimo. Free consultations are available by phone toll free at 1-866-712-5353.

How long does a consumer proposal take in BC?

A consumer proposal in BC typically takes between 3 and 5 years to complete, depending on the negotiated repayment terms. Once you make your final payment and complete the required financial counselling sessions, your remaining unsecured debts included in the proposal are legally discharged.

Can I Include CRA Tax Debt in a Consumer Proposal in BC?

Douglas Thode

10 hours ago

2 min read

Yes. Income tax debt you owe to the Canada Revenue Agency can generally be included in a consumer proposal, along with your other unsecured debts.

I'm Doug Thode, a Licensed Insolvency Trustee in Kelowna, helping people across the entire province of British Columbia and the Yukon, from Vancouver and Victoria to Kelowna, Kamloops and Prince George.

Watch on YouTube: https://youtu.be/409SgnVZ78c

How it works

When you file a consumer proposal through a Licensed Insolvency Trustee, you offer your creditors a payment they can accept, usually less than the full amount you owe, spread over a term of up to five years. The Canada Revenue Agency is treated as a creditor, just like a credit card company or a bank. You make one payment to the trustee, and the trustee distributes it.

Stay of proceedings

Filing also creates a stay of proceedings. That generally stops collection action by your unsecured creditors, including the Canada Revenue Agency, for the debts covered by the proposal.

Two things to know

First, the Canada Revenue Agency votes on your proposal like any other creditor, so the offer has to be reasonable for your situation. Second, some tax debts, such as payroll source deductions owed by a business, have special rules. Your trustee needs to look at exactly what you owe.

Can I Include CRA Tax Debt in a Consumer Proposal in BC?

How it works

Stay of proceedings

Two things to know

Related questions

What happens if I owe the CRA and don't file?

How long does a consumer proposal last in Canada?

Will I lose my house or car in a consumer proposal?

What is the difference between a consumer proposal and bankruptcy?

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