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NEW In-House Counsel | Insurance | Intellectual Property | Immigration | Natural Resources | Real Estate | Tax

Director resignations and personal liability for corporate tax debts

Tuesday, October 17, 2017 @ 8:39 AM | By Adrienne Woodyard

The prospect that a corporate director may be held personally liable for corporate tax debts is the stuff of nightmares. The possibility exists, however, because the Canada Revenue Agency may look to the directors to collect a corporation’s unpaid HST or payroll taxes.

The issue of director liability has been heavily litigated, because the question whether a particular director is liable for a corporation's debt depends largely on the facts. Many former directors rely on the "two-year rule" contained in the Income Tax Act and the...