Excise Tax Act (R.S.C., 1985, c. E-15)

Marginal note:Garnishment

• 317 (1) If the Minister has knowledge or suspects that a particular person is, or will be within one year, liable to make a payment to another person who is liable to pay or remit an amount under this Part (in this subsection and subsections (2), (3), (6) and (11) referred to as the “tax debtor”), the Minister may, by notice in writing, require the particular person to pay without delay, if the moneys are payable immediately, and in any other case as and when the moneys become payable, the moneys otherwise payable to the tax debtor in whole or in part to the Receiver General on account of the tax debtor’s liability under this Part.

• Marginal note:Idem

  (2) Without limiting the generality of subsection (1), where the Minister has knowledge or suspects that within ninety days

  • (a) a bank, credit union, trust company or other similar person (in this section referred to as the “institution”) will loan or advance moneys to, or make a payment on behalf of, or make a payment in respect of a negotiable instrument issued by, a tax debtor who is indebted to the institution and who has granted security in respect of the indebtedness, or

  • (b) a person, other than an institution, will loan or advance moneys to, or make a payment on behalf of, a tax debtor who the Minister knows or suspects

    • (i) is employed by, or is engaged in providing services or property to, that person or was or will be, within ninety days, so employed or engaged, or

    • (ii) where that person is a corporation, is not dealing at arm’s length with that person,

  the Minister may, by notice in writing, require the institution or person, as the case may be, to pay in whole or in part to the Receiver General on account of the tax debtor’s liability under this Part the moneys that would otherwise be so loaned, advanced or paid, and any moneys so paid to the Receiver General are deemed to have been loaned, advanced or paid, as the case may be, to the tax debtor.

• Marginal note:Garnishment

  (3) Despite any other provision of this Part, any other enactment of Canada other than the Bankruptcy and Insolvency Act, any enactment of a province or any law, if the Minister has knowledge or suspects that a particular person is, or will become within one year, liable to make a payment

  • (a) to a tax debtor, or

  • (b) to a secured creditor who has a right to receive the payment that, but for a security interest in favour of the secured creditor, would be payable to the tax debtor,

  the Minister may, by notice in writing, require the particular person to pay without delay, if the moneys are payable immediately, and in any other case as and when the moneys become payable, the moneys otherwise payable to the tax debtor or the secured creditor in whole or in part to the Receiver General on account of the tax debtor’s liability under this Part, and on receipt of that notice by the particular person, the amount of those moneys that is so required to be paid to the Receiver General shall, despite any security interest in those moneys, become the property of Her Majesty in right of Canada to the extent of that liability as assessed by the Minister and shall be paid to the Receiver General in priority to any such security interest.

• (4) [Repealed, 2000, c. 30, s. 95]

• Marginal note:Effect of receipt

  (5) A receipt issued by the Minister for moneys paid as required under this section is a good and sufficient discharge of the original liability to the extent of the payment.

• Marginal note:Effect of requirement

  (6) If the Minister has, under this section, required a person to pay to the Receiver General on account of the liability under this Part of a tax debtor moneys otherwise payable by the person to the tax debtor as interest, rent, remuneration, a dividend, an annuity or other periodic payment, the requirement applies to all such payments to be made by the person to the tax debtor until the liability under this Part is satisfied and operates to require payments to the Receiver General out of each such payment of such amount as is stipulated by the Minister in a notice in writing.

• Marginal note:Failure to comply

  (7) Every person who fails to comply with a requirement under subsection (1), (3) or (6) is liable to pay to Her Majesty in right of Canada an amount equal to the amount that the person was required under subsection (1), (3) or (6), as the case may be, to pay to the Receiver General.

• Marginal note:Idem

  (8) Every institution or person that fails to comply with a requirement under subsection (2) with respect to moneys to be loaned, advanced or paid is liable to pay to Her Majesty in right of Canada an amount equal to the lesser of

  • (a) the aggregate of moneys so loaned, advanced or paid, and

  • (b) the amount that the institution or person was required under that subsection to pay to the Receiver General.

• Marginal note:Assessment

  (9) The Minister may assess any person for any amount payable under this section by the person to the Receiver General and, where the Minister sends a notice of assessment, sections 296 to 311 apply, with such modifications as the circumstances require.

• Marginal note:Time limit

  (10) An assessment of an amount payable under this section by a person to the Receiver General shall not be made more than four years after the notice from the Minister requiring the payment was received by the person.

• Marginal note:Effect of payment as required

  (11) If an amount that would otherwise have been payable to or on behalf of a tax debtor is paid by a person to the Receiver General pursuant to a notice from the Minister issued under this section or pursuant to an assessment under subsection (9), the person is deemed, for all purposes, to have paid the amount to or on behalf of the tax debtor.

• Marginal note:Application to Her Majesty in right of a province

  (12) Provisions of this Part that provide that a person who has been required to do so by the Minister must pay to the Receiver General an amount that would otherwise be lent, advanced or paid to a particular person who is liable to make a payment under this Part, or to that particular person’s secured creditor, apply to Her Majesty in right of a province.

Marginal note:Recovery by deduction or set-off

318 Where a person is indebted to Her Majesty in right of Canada under this Part, the Minister may require the retention by way of deduction or set-off of such amount as the Minister may specify out of any amount that may be or become payable to that person by Her Majesty in right of Canada.

Marginal note:Acquisition of debtor’s property

319 For the purpose of collecting debts owed by a person to Her Majesty in right of Canada under this Part, the Minister may purchase or otherwise acquire any interest in the person’s property that the Minister is given a right to acquire in legal proceedings or under a court order or that is offered for sale or redemption, and may dispose of any interest so acquired in such manner as the Minister considers reasonable.

Marginal note:Moneys seized from tax debtor

• 320 (1) If the Minister has knowledge or suspects that a particular person is holding moneys that were seized by a police officer in the course of administering or enforcing the criminal law of Canada from another person who is liable to make a payment under this Part (in this section referred to as the “tax debtor”) and that are restorable to the tax debtor, the Minister may, in writing, require the particular person to turn over the moneys otherwise restorable to the tax debtor, in whole or in part, to the Receiver General on account of the tax debtor’s liability under this Part.

• Marginal note:Receipt of Minister

  (2) A receipt issued by the Minister for moneys turned over as required under this section is a good and sufficient discharge of the requirement to restore the moneys to the tax debtor to the extent of the amount so turned over.

Marginal note:Seizure of chattels

• 321 (1) Where a person fails to pay an amount as required under this Part, the Minister may give thirty days notice to the person by registered or certified mail addressed to the person’s latest known address of the Minister’s intention to direct that the person’s goods and chattels be seized and sold, and, if the person fails to make the payment before the expiration of the thirty days, the Minister may issue a certificate of the failure and direct that the person’s goods and chattels be seized.

• Marginal note:Idem

  (2) Property seized under this section shall be kept for ten days at the expense and risk of the owner and, if the owner does not pay the amount due together with all expenses within the ten days, the property seized shall be sold by public auction.

• Marginal note:Idem

  (3) Except in the case of perishable goods, notice of a sale referred to in subsection (2) setting out the time and place thereof, together with a general description of the property to be sold shall, a reasonable time before the goods are sold, be published at least once in one or more newspapers of general local circulation.

• Marginal note:Idem

  (4) Any surplus resulting from a sale referred to in subsection (2), after deduction of the amount owing and all expenses, shall be paid or returned to the owner of the property seized.

• Marginal note:Idem

  (5) Such goods and chattels of any person in default as would be exempt from seizure under a writ of execution issued out of a superior court of the province in which the seizure is made are exempt from seizure under this section.

Marginal note:Person leaving Canada

• 322 (1) If the Minister suspects that a person has left or is about to leave Canada, the Minister may, before the day otherwise fixed for payment, by notice to the person served personally or sent by registered mail addressed to the person’s latest known address, demand payment of any amount for which the person is liable under this Part or would be so liable if the time for payment of the amount had arrived, and that amount shall be paid without delay despite any other provision of this Part.

• Marginal note:Failure to satisfy demand

  (2) If a person fails to pay an amount as required under subsection (1), the Minister may direct that goods and chattels of the person be seized, and subsections 321(2) to (5) apply with any modifications that the circumstances require.

Marginal note:Definitions

• 322.1 (1) The definitions in this subsection apply in this section.

  assessed period

  assessed period of a person, in respect of an authorization under subsection (2) relating to a particular reporting period of the person, means

  • (a) if the hearing date is before the last day of the particular reporting period, the period beginning on the first day of the particular reporting period and ending on the assessment date; and

  • (b) in any other case, the particular reporting period. (période visée)

  assessment date

  assessment date, in respect of an authorization under subsection (2), means the day immediately before the hearing date. (date de cotisation)

  hearing date

  hearing date, in respect of an authorization under subsection (2), means the day on which a judge hears the application for the authorization. (date d’audience)

  judge

  judge means a judge of a superior court of a province or a judge of the Federal Court. (juge)

• Marginal note:Authorization to assess and take collection action

  (2) If, on ex parte application by the Minister relating to a particular reporting period of a person, a judge is satisfied that there are reasonable grounds to believe that the net tax for the period, determined without reference to this section, would be a positive amount and that the collection of all or any part of that net tax would be jeopardized by a delay in its collection, the judge shall, on such terms as the judge considers reasonable in the circumstances, authorize the Minister to, without delay,

  • (a) assess the net tax for the assessed period, determined in accordance with subsection (3); and

  • (b) take any of the actions described in sections 316 to 321 in respect of that amount.

• Marginal note:Effect of authorization

  (3) For the purposes of this Part, where an authorization is granted under subsection (2) in respect of an application relating to a particular reporting period of a person,

  • (a) if the hearing date is before the last day of the particular period,

    • (i) the following periods are each deemed to be a separate reporting period of the person:

      • (A) the assessed period, and

      • (B) the period beginning on the hearing date and ending

        • (I) where the particular period is a fiscal year, on the last day of the fiscal quarter of the person that includes the hearing date, and

        • (II) in any other case, on the last day of the particular period, and

    • (ii) where the particular period is a fiscal year,

      • (A) the person is deemed to have made an election under section 247 to have reporting periods that are fiscal quarters of the person that takes effect at the beginning of the first fiscal quarter of the person beginning after the hearing date, and

      • (B) section 237 applies in respect of the assessed period as if that period were a reporting period determined under subsection 248(3);

  • (b) the day on or before which the person is required to file a return under Division V for the assessed period is deemed to be the hearing date;

  • (c) the net tax for the assessed period is deemed to be equal to the amount that would be the net tax for the period if, on the assessment date, the person were to claim in a return under Division V filed for the period all amounts, each of which is an amount that the person would be entitled on that day to claim as an input tax credit for the period or as a deduction in determining the net tax for the period;

  • (d) the net tax for the assessed period is deemed to have become due to the Receiver General on the hearing date;

  • (e) if, in assessing the net tax for the assessed period, the Minister takes into account an amount that the person would be entitled to claim as an input tax credit or a deduction in determining the net tax, the person is deemed to have claimed the amount in a return filed under Division V for the assessed period; and

  • (f) sections 280, 280.1 and 284 apply as if the net tax for the assessed period were not required to be remitted, and the return for that period were not required to be filed, until the last day of the period described in subsection (9).

• Marginal note:Affidavits

  (4) Statements contained in an affidavit filed in the context of an application under this section may be based on belief in which case it must include the grounds for that belief.

• Marginal note:Service of authorization and notice of assessment

  (5) An authorization granted under subsection (2) in respect of a person shall be served by the Minister on the person within 72 hours after it is granted, except if the judge orders the authorization to be served at some other time specified in the authorization, and a notice of assessment for the assessed period shall be served on the person together with the authorization.

• Marginal note:How service effected

  (6) For the purpose of subsection (5), service on a person shall be effected by personal service on the person or service in accordance with the directions of a judge.

• Marginal note:Application to judge for direction

  (7) If service cannot reasonably be effected as and when required under this section, the Minister may, as soon as practicable, apply to a judge for further direction.

• Marginal note:Review of authorization

  (8) If a judge of a court has granted an authorization under subsection (2) in respect of a person, the person may, on six clear days notice to the Deputy Attorney General of Canada, apply to a judge of the court to review the authorization.

• Marginal note:Limitation period for review application

  (9) An application by a person under subsection (8) to review an authorization shall be made

  • (a) within 30 days after the day on which the authorization was served on the person in accordance with this section; or

  • (b) within such further time as a judge may allow, on being satisfied that the application was made as soon as practicable.

• Marginal note:Hearing in camera

  (10) An application by a person under subsection (8) may, on the application of the person, be heard in private, if the person establishes to the satisfaction of the judge that the circumstances of the case justify proceedings heard in private.

• Marginal note:Disposition of application

  (11) On an application under subsection (8), the judge shall determine the question summarily and may confirm, vary or set aside the authorization and make such other order as the judge considers appropriate.

• Marginal note:Effect of setting aside authorization

  (12) If an authorization is set aside under subsection (11), subsection (3) does not apply in respect of the authorization and any assessment made as a result of the authorization is deemed to be void.

• Marginal note:Directions

  (13) If any question arises as to the course to be followed in connection with anything done or being done under this section and there is no relevant direction in this section, a judge may give such direction with regard to the course to be followed as, in the opinion of the judge, is appropriate.

• Marginal note:No appeal from review order

  (14) No appeal lies from an order of a judge made under subsection (11).