- A Requirement to Pay (RTP) is a written demand the CRA sends to a third party who owes money to a tax debtor — typically an employer, a bank, or a business customer.
- It's tempting to think of a Requirement to Pay the way you'd think of a wrongly issued ticket — something you fight and get cancelled.
- - Negotiate directly with the CRA collections officer.
Getting a notice that the Canada Revenue Agency has issued a Requirement to Pay against you is unsettling — especially when it means your employer, bank, or a customer has been ordered to redirect money to the CRA instead of to you. Unlike most creditors, the CRA doesn't need to sue you or get a judge's permission before reaching into your income or your accounts.
That doesn't mean you're powerless. There are real, practical steps you can take once a Requirement to Pay is active — some aimed at resolving the underlying tax debt, others aimed at how and how fast it gets collected. Understanding the difference matters, because they run on separate tracks.
This article explains what a Requirement to Pay actually does, why it's hard to "challenge" the way you'd challenge a court order, and what realistically can change your situation.
What a Requirement to Pay Actually Does
A Requirement to Pay (RTP) is a written demand the CRA sends to a third party who owes money to a tax debtor — typically an employer, a bank, or a business customer. It requires that third party to pay the CRA directly, up to the amount of the outstanding tax debt, instead of paying the debtor.
The CRA can issue an RTP under its own authority, without going to court first. This is one of the features that makes CRA collection powers unusually strong compared to those of an ordinary creditor, who generally has to sue, win, and get a judgment before garnishing wages or freezing an account.
Once an RTP is in place, the third party is legally obligated to comply. A bank or employer that ignores a valid RTP and pays the debtor anyway can become personally liable to the CRA for the amount it should have withheld.
Why "Challenging" the RTP Is Different From Disputing the Debt
It's tempting to think of a Requirement to Pay the way you'd think of a wrongly issued ticket — something you fight and get cancelled. In practice, an RTP is a collection tool, not a decision about whether you owe the money. Arguing the underlying tax debt is wrong doesn't happen through the RTP itself.
Two separate questions are usually in play:
- Is the tax debt correct? That's disputed through a Notice of Objection and, if necessary, an appeal to the Tax Court of Canada — not by responding to the RTP.
- Is the CRA collecting it the right way, at the right time, from the right party? That's where there's more room to engage directly with CRA collections.
Confusing the two tracks wastes time. If you believe the assessment itself is wrong, the objection process — not a dispute over the RTP — is where that argument belongs.
Options That Can Actually Change the Outcome
- Negotiate directly with the CRA collections officer. CRA collections staff generally have discretion to vary, limit, or release an RTP where a taxpayer proposes a credible payment arrangement. This is often the fastest practical route.
- Show financial hardship. If the RTP is taking money you need for basic living expenses, the CRA has discretion to reconsider its approach. Supporting documentation — income, expenses, dependants — strengthens this conversation.
- Pursue a Notice of Objection on the underlying assessment, if you have grounds to dispute it. Depending on the type of taxpayer and debt involved, this can affect CRA collection activity while the dispute is pending — worth exploring with a tax lawyer, since the rules differ for individuals, corporations, and GST/HST debts.
- Apply for taxpayer relief if penalties or interest, rather than the core tax owing, are driving the debt higher. This won't stop an active RTP by itself, but it can shrink the total amount being collected.
- Raise a procedural problem, if one exists — for example, if the RTP appears to have gone to the wrong party, for the wrong amount, or without proper notice. This is narrower ground and usually needs legal review to assess.
None of these routes guarantees a particular outcome. CRA collections decisions are discretionary, and the agency isn't required to grant relief, a payment plan, or a release just because you ask.
If the CRA Sent the Notice to the Wrong Party or in Error
Mistakes happen — an RTP addressed to a former employer, an account belonging to someone else, or an amount that doesn't match your actual balance. If you believe the RTP itself contains an error, not just a disagreement with the underlying tax bill, raise it with the CRA collections officer named on the notice as soon as possible and put your concern in writing. Keep records of every call and letter.
What Happens If You Ignore It
An RTP doesn't go away by itself, and ignoring correspondence from CRA collections tends to narrow your options rather than widen them. The debt continues to accrue interest, and the CRA can issue additional RTPs to other third parties — another employer, another account, another customer — until the balance is satisfied or a payment arrangement is reached.
Frequently asked questions
Can I get a Requirement to Pay cancelled just by asking?
Not automatically. The CRA has discretion to vary or release an RTP, usually in exchange for a credible payment plan or evidence of genuine hardship, but there's no guaranteed right to have it lifted just because it's inconvenient.
Does paying off part of the debt stop the RTP?
It can reduce what's being collected, and full payment ends it, but a partial payment alone doesn't automatically cancel the notice — you generally still need to reach an arrangement with CRA collections.
Will my employer tell me if the CRA sends a Requirement to Pay?
Employers are legally required to comply with a valid RTP, but there's no specific rule requiring advance warning to the employee before it takes effect — many people find out from a smaller paycheque or a call from HR.
Can I be personally liable if my business ignores an RTP sent about a customer's debt?
Yes. A third party that receives a valid RTP and pays the tax debtor anyway, instead of the CRA, can become personally liable to the CRA for the amount that should have been redirected.
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