Typically, the CRA cannot pursue one person for the tax debt of a different person. But directors’ liability and section 160 assessments are two exceptions:

  • Director’s liability allows CRA to pursue a director for the tax debts of their corporation.
  • If someone who has a tax debt transfers property to a person with whom they are related, section 160 of the Income Tax Act allows CRA to pursue the related person for the tax debt of the transferor.

Despite CRA’s collections powers, there are defences to both of these types of assessments.