Creditors can garnish your wages if you have stopped making payments towards your debt. In most cases they must obtain a wage garnishment order from the court and depending on the province can garnish up to 50% of your wages. If you are facing a a garnishee, read our tip sheet with 5 basic facts you need to know about a wage garnishment in Canada.
If you think bankruptcy can help, contact a bankruptcy trustee or review our other articles about dealing with a garnishment order:
- Is bankruptcy the best way to stop a wage garnishment
- Can creditors call my employer about my debts?
- What to do when CRA freezes your bank account.
- Who will know I’ve filed bankruptcy?
I’m self-employed. My income is strictly commission. Can this be garnished?
Bill: It is more difficult for a creditor to garnishee someone who is self-employed, because technically there is no “employer”. However, if most of your income is from one source, it’s generally not difficult for the creditor to figure out who you “work” for, and get a court order to garnishee your income. It is very easy for CRA to do this if you owe taxes, because they generally know where you are earning your income.
I am considering returning to employment with an employer that I left for a better paying job over 2 years ago. At the time I had a garnishment on my wages through that employer. If I am rehired, is the employer obligated to continue with the garnishee or is a new garnishee order required?
Hi Alan. Yes, if the garnishment order is still in effect, and your employer is aware of it, they would likely resume the garnishment once you start working there again. I suggest you talk to the employer and ask them if they still have the paperwork, and whether or not they plan to enforce it.
I was told in New Brunswick wages cannot be garnished by companies. Is this true?
It is not. I am not a lawyer so I can’t give you legal advice, but try a Google search for “wage garnishments New Brunswick” and you’ll find many sites that explain the process. Very breifly, the people you owe money to have the right to apply to the Court for a Judgment and then for the right to garnishee your wages.
I have a garnishment with cra and have left that employer. I have started a new job and would like to make arrangements to pay off the remaining balance without the new job getting garnished. How do i do this? Also.. how long will it take before they garnish the new job..so I have time to call them
Hi Nicole. Unless you tell CRA where you are working, it is likely that they won’t find out where you are working until they get a copy of your T4 at the end of the year. To avoid a further garnishment, you have two choices.
First, you could simply start making payments to CRA. You can set them up as a bill payee through your bank, and send a payment to them every payday if you want, just like you pay any other bill. If they amount you owe them can be paid off over the next few months, that may be the simplest option.
The second option would be to call CRA and make payment arrangements directly with them (“Hi, I’d like to send you $XXX every month; if I do that, will you agree to not garnish my wages?”) The disadvantage to this strategy is you may have to wait on hold on the phone for an hour to talk to a human being, and there is also the chance that CRA will say “tell us where you work so we can notify your new employer of the garnishment”, so the best strategy will depend on whether or not you can get them paid off before they find out where you are now working.
How long will it take for creditors to garnish your wage ?
First, a creditor needs to obtain a Judgment against you from Court. Then they need to apply for a Writ of Execution and/or Seizure. That will allow them to garnishee your wages. In Ontario if a debt is under $25,000 you may be sued in Small Claims Court. A person goes to the Court House, pays a fee and starts an action. You will have 21 days to respond. If you don’t they may apply to the Court for a Default Judgment and then apply for the Writ. So with Small Claims your wages could be garnisheed in 4 to 6 weeks after they start the process. For debts over $25,000 you need to be sued in Superior Court. The process is generally longer. Once you are served with the lawsuit you will have 22 days to respond. If you fail to respond then they may apply for a Default Judgment and then a Writ which will allow them to garnishee your wages. Again, if you do nothing, then 4 to 6 weeks from being served. If you defend it may be stretched out to months, depending on how busy the Courts are…
You should search specifically about wage garnishee’s – not really our area of expertise. We can stop them when a person files a consumer proposal or bankruptcy, but we aren’t lawyers so that is really who you should be speaking to before the fact.
Living in NL. I lost a small claims case of less than $2000 to a small privately owned contracting company. I have yet to pay my debt and quite honestly, I’m fine with making it difficult to collect.
How would the other party go about garnishing my wages? Timeline? Percentages?
To garnishee your wages they would obtain a garnishment order from the court, and serve it on your employer. Generally that can be done relatively quickly, but it will depend on the speed the court operates.
Can a collection agency garnish wages from a unpaid credit card from past years
Not without taking the person to Court first. They need to obtain a Judgment against the card holder, then request of Writ of Seizure and Execution. Once they have the Writ they may send a notice to garnishee a person’s wages.
Can more than one creditor garnish your wages. The cra is already taking 50% of our income. Can another creditor garnish on top of that?
Hi Caroline. In Ontario, legally, the maximum amount that a non-government creditor can garnishee is generally 20% of your wages, so if you already have a CRA garnishment of 50%, other creditors are not allowed to garnishee you. However, if the court doesn’t know about the other garnishment, they may issue a garnishment order. I suggest you speak to a licensed insolvency trustee to review your options.
Hi there
In the past few months I have faced extreme hardship. I am now barely employed and doing piecework here and there, all my savings are gone to bills and I have not been able to keep up with a credit card. I then received a notice to file and they did end up getting a judgment by default because I foolishly thought I would be getting sent a notice to appear with a date of the court date. This was not the case.
My income tax return is my only saving grace and iI wanted to know by your experience how quickly they may seize it. Do they send me a notice to garnish? I am already on the brink here and I need that to pay my rent/feed my child. Employment is not looking good in my near future. I sadly am relying on that return. It was filed yesterday and their court judgment was given 6 days ago.
Do they say anything before they start seizing this kind of thing? Or do they just do it?
Hi Brittany. It depends on what the court has ordered. If they court has ordered that your wages be garnisheed you don’t need to worry about it until you are back to work. If the court has given the creditor permission to freeze your bank account, then presumably they will get your tax refund when it is deposited into your bank account (although that would be unusual). The answer will depend on whether or not the creditor knows where you are banking. A licensed insolvency trustee can give you further information.
Hello hoping someone can shed some light for me. I lent a “friend” a sum of cash and since has refused to pay me back. I know I have the right to reclaim my money but can a court garnish this persons alimony payments? Thank you.
Hi Valerie. As a general rule a court does not garnishee alimony payments. This would be a question to ask a lawyer who could give you a more specific answer, and advise you on what options in the court process you may have.
If I am a non-resident of British Columbia now and living/working overseas, then can a collection agency do what’s necessary through a court to take money out of my bank account?
Hi Richy. If you have a bank account in Canada with money in it, then yes, a creditor could go to court to obtain a judgement to seize your Canadian bank account. If your bank account is not in Canada then the creditor would likely need to sue you in whatever country you are in, so it’s highly unlikely they would be able to take money out of a foreign bank account without your permission.
Hello!
I have some outstanding credit card debt of ~13000$ from Canada. I have no assets (no house, no car, no investments, and my bank account usually has less than 1000 dollars in it) and I don’t live in Canada. Everything is under my wife as she handles most everything. I just teach English. Can a Canadian credit card company try to garnish my wages in Asia? thanks
Hi Jessie. They can try, but it would be extremely difficult, because they would have to first sue you in Canada, and then sue you in Asia to enforce the judgment, and they would have to know where you are working in Asia to garnishee your wages, so the chances of that happening are virtually zero.
On Jan. 5th 2016 I slipped on ice coming out of the bank and injured myself and have not worked a day since. I had a job, savings and a credit score over 800. Needless to say I could not do my job and was replaced, I lost everything and had to finally go on Social Services disability. Also during that time I had to care for my father who suffered severe Dementia until he passed in April 2016 and I now suffer depression. Fortunately I turned 65 and now on OAS with GIS and Sask. Provincial supplements totaling about 1800.00 a month that is barely getting me by. I only have credit card debt remaining, about 14000.00 and growing due to fees. Can they Garnish my income? Thx
I do not believe they can. As a pensioner, your income is protected and by extension, any tax refund based on that income should also be protected.
Hi I have a credit card debt that is 28000 dollards at the beginning it was 10000 but went up because interestest in one year and a half I live in Canada but I don’t have any properties here I have some property out of the country can they garnish my wages from another country ? South America
There are no international treaties on debt collection so the only way a CDN creditor could garnishee your wages in another country would be to take you to Court in that other country. What is more likely is that the CDN creditor might get a court order to seize whatever money is in your CDN bank account.
I am in student debt of 74,000. Is this a high enogh debt that creditors would start garnishing my wages? I graduated in 2019, and am waiting another 2-3 yrs to declare bankrupsy but im worried they might try to garnish wages by then.
They certainly have the right to. It really depends on your current financial situation. Are you working? Are you benefiting from your education? That sort of thing. FYI – you need to have been out of school for 7 years to include student loans in a bankruptcy. Good luck.
I have not acknowledged any debt in over two years.
Can they still garnish my wages?
Certainly if they obtain a Court Order allowing them to do so. The Limitations Act is a “defence” you may use in Court if/when you are sued, BUT you have to appear in Court and make the request. If you aren’t in Court to claim the Limitations defence the Court won’t use it.
I have a garnishment order with my main employer.
If I acquire a second part time job, will my second employer be required to garnish my wage as well?
Only if the party with the garnishee sends them a copy of the Court Order. If the person/company that sued you learns of the second job they might…
Easy finacial sent my file to a collection agency when i look up information it tells me they can garnish up to 50 % of my wages but it also says the min is 20% i might not beable to stop it in time i only make 1034 every 2 weeks.
A “normal” garnishee is 20% of your earnings to a maximum of 50% for all garnishees. The government sets its own rates – again with a maximum of 50% for people receiving a pay cheque (100% if you are self employed).