TFSAs, RRSPs and Consumer Proposals

Sunday, November 5, 2017 - 23:10

Consumer Proposals, Asset Concerns


With a consumer proposal, you get to keep your assets, which includes your tax free savings account and your RRSPs.

When you make a consumer proposal, you are offering your creditors a settlement, which is more than what they would get if you were to go bankrupt.

Essentially you are saying, “let me keep all of my stuff, and I will agree to pay you some amount of money over time.”

If you were to file personal bankruptcy you would be able to keep most, if not all of your RRSP.

Not all tax shelters are safe when filing personal bankruptcy, but here are a few details:

  • RRSP accounts are exempt from seizure by creditors in a bankruptcy, except for contributions made in the 12 month period immediately prior to filings
  • Some RRSP accounts are completely exempt
  • TFSA accounts are not exempt from seizure by creditors under any circumstances in a bankruptcy so you would lose your TFSA

If you're curious about what it takes to make a consumer proposal, and other benefits to making a consumer proposal vs. filing bankruptcy, click here for more information here.

If you you're struggling with debt and think a consumer proposal is right for you, or if you simply have questions, contact our office today and meet with a licensed insolvency trustee  at NO charge.

We have offices across South Western Ontario plus flexible hours to meet your needs so you don't have to miss work.

Let us help you get a fresh financial start!

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