CRA Seizing Your Client Payments: How the CRA Redirects Your Invoices, Accounts Receivable, and Platform Income — And How to Stop It (Montreal CPA Firm Guide)

One of the most financially devastating actions the Canada Revenue Agency can take is the seizure of accounts receivable. When CRA issues a Requirement to Pay (RTP) to your clients, customers, or payment platforms, they must legally redirect money owed to you directly to CRA.
This enforcement action does not just reduce your cash flow—it can eliminate it entirely. Businesses suddenly find that clients stop paying them, digital platforms hold back payouts, and contracts become unprofitable overnight.
This guide explains how CRA intercepts receivables, why certain taxpayers are targeted, the legal framework behind it, and the exact steps required to stop or reverse this enforcement tool before a business collapses.

Legal and Regulatory Framework

CRA’s authority to seize accounts receivable comes from several federal statutes, primarily the Income Tax Act and the Excise Tax Act. These laws allow CRA to:
• issue a Requirement to Pay to any person or business who owes the taxpayer money
• redirect payments from clients directly to CRA
• seize 100 percent of those amounts until the debt is paid
• apply seizures to future invoices until CRA lifts the RTP
• continue enforcement even when the taxpayer disputes the assessment, in the case of GST/QST
• garnish payments from digital platforms and payment processors

Unlike private creditors, CRA does not require a court order to intercept receivables.

Key Court Decisions

Canadian courts have consistently confirmed that:
• CRA may seize receivables without prior notice
• the RTP is binding on clients, even if they do not want to cooperate
• clients who ignore CRA’s RTP can be held personally liable
• CRA can seize future receivables, not only existing invoices
• financial hardship does not invalidate the RTP
• the taxpayer must challenge the underlying assessment through an objection
• the courts will rarely intervene unless CRA failed procedural fairness

This jurisprudence makes CRA receivable seizures one of the most difficult enforcement actions to reverse without structured negotiation.

Why CRA Seizes Accounts Receivable

CRA uses this enforcement tool for taxpayers considered high-risk, especially those who are self-employed or operate cash-flow–dependent businesses. Triggers include:
• unpaid GST/QST trust amounts
• missing tax returns for multiple years
• large unpaid income tax balances
• repeated missed payment arrangements
• refusal to provide bank statements or financial disclosure
• failure to respond to CRA Collection calls or letters
• real estate contractors with inconsistent reporting
• e-commerce sellers with unreported platform income
• consultants or service providers who invoice clients directly
• corporations suspected of hiding or reallocating income

Receivable seizures often follow earlier enforcement actions such as bank freezes or wage garnishments.

How CRA Seizes Accounts Receivable (Deep Explanation)

A Requirement to Pay issued to a client or platform requires them by law to:
• stop paying you
• send 100 percent of all owed amounts to CRA
• continue redirecting payments until CRA withdraws the RTP
• notify CRA of any planned payments
• disclose the full amount they owe you

CRA may issue RTPs to:
• corporate clients
• government clients
• payment processors
• e-commerce platforms
• rental tenants
• real estate buyers in property transactions
• contractors and subcontractors
• large-volume suppliers
• digital platforms
• Shopify, PayPal, Stripe, Etsy, Upwork
• Amazon FBA or FBM payouts
• Uber, DoorDash, SkipTheDishes income
• property managers collecting rent

When CRA seizes receivables, all future income from those payers effectively disappears.

Immediate Consequences for Businesses

Accounts receivable seizures can cripple operations within days:
• clients refuse to work with you because they fear CRA liability
• suppliers stop extending credit
• employees experience pay delays
• business cash flow collapses
• project milestones are missed
• contractors refuse to continue work
• rent, insurance, and loan payments fail
• digital platforms suspend or close accounts
• penalties accumulate
• CRA escalates to liens or bank freezes

Many businesses fail due to receivable seizures—not because of tax debt, but because cash flow disappears.

Mackisen Strategy

Stopping CRA receivable seizures requires speed, technical expertise, and high-level negotiation. Mackisen CPA uses a specialized enforcement defence protocol built specifically for these high-risk situations.

Step 1 — Immediate CRA Intervention

We contact the assigned CRA collections officer the same day to request:
• a temporary pause on incoming RTPs
• confirmation of all active RTPs
• identification of targeted clients
• the exact amount required to lift the seizures
• clarification of CRA’s risk assessment

This halts the rapid spread of RTPs to additional payers.

Step 2 — Establish Legal Protection

We evaluate whether CRA’s assessment is correct and whether enforcement can be paused:
• filing Notices of Objection
• challenging incorrect GST/QST assessments
• correcting improper assumptions
• requesting a collections hold
• preparing Taxpayer Relief submissions
• determining whether trust amounts are involved

Legal positioning determines negotiation leverage.

Step 3 — Bring All Filings Up to Date

CRA will not lift receivable seizures if the file is considered “non-compliant.”
We immediately file:
• missing GST/QST returns
• payroll remittances
• T1 and T2 returns
• adjustments to correct errors
• missing year-ends
• input tax credit recalculations
• financial statements and projected remittances

Compliance transforms the file from “high-risk” to “manageable.”

Step 4 — Cash Flow and Capacity Modeling

CRA requires detailed financial disclosure to stop receivable seizures. Mackisen prepares:
• full cash flow models
• income and expense projections
• debt servicing obligations
• essential business expenses
• payroll needs
• supplier obligations
• future tax remittances
• AR and AP aging schedules

This documentation allows CRA to consider alternatives to ongoing seizures.

Step 5 — Negotiation With CRA

We negotiate:
• full removal of all RTPs
• conditional removal based on payment plan
• reduced seizure percentage
• temporary freeze on enforcement
• payment plan based on business capacity
• grace periods for filing
• permission for clients to resume payments
• long-term arrangements to prevent recurrence

CRA is dramatically more flexible when presented with professional, detailed documentation.

Step 6 — Protection Against Future RTPs

Once RTPs are lifted, Mackisen creates a long-term prevention plan:
• GST/QST compliance monitoring
• monthly remittance schedules
• payroll compliance checks
• CRA communication handling
• budgeting and cash flow controls
• annual tax planning

This reduces the likelihood of future enforcement.

Real Client Experience

A Montreal construction subcontractor had all accounts receivable seized after CRA issued RTPs to 14 large clients. The business could no longer operate because all incoming progress payments were intercepted by CRA.
Mackisen intervened within hours, filed missing GST/QST returns, identified over $85,000 in input tax credits, disputed an incorrect assessment, recalculated the actual balance, and negotiated a structured payment plan. CRA lifted the RTPs, and the client resumed operations by the end of the week.

Another client, an Amazon seller, had all payouts seized through a CRA RTP to Amazon. We corrected their sales tax filings, negotiated a repayment schedule, and secured permission for Amazon to resume weekly payouts.

Common Questions

• Can CRA seize 100 percent of my receivables? Yes.
• Can CRA issue RTPs to every one of my clients? Yes.
• Will clients know I have tax problems? Yes; they receive the notice.
• Can CRA seize digital platform payments? Yes.
• Does filing an objection stop receivable seizures? Only for income tax, not GST/QST or payroll.
• Can CRA seize payments multiple times from the same client? Yes.
• Can CRA seize incoming rent from tenants? Yes.
• Do RTPs affect credit ratings? Indirectly, through cash flow collapse.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps businesses stay compliant while recovering the taxes they’re entitled to. Whether you’re filing your first GST/QST return or optimizing multi-year refunds, our expert team ensures precision, transparency, and protection from audit risk.