Payroll may be due, suppliers may be waiting and customers may still owe money. The business could be profitable over the long term, but it cannot function normally without access to its operating account.
When the Canada Revenue Agency is collecting tax arrears, a traditional bank may be unwilling to provide additional credit. For an Ontario business owner with property equity, mortgage financing may offer another avenue to review.
Why a CRA Account Freeze Creates Immediate Pressure
A frozen account can prevent the business from using money that would normally fund wages, inventory, rent and daily expenses.
The owner may need to address the tax obligation while also protecting the company’s operations. Simply injecting more money without understanding the CRA requirement may not solve the problem.
The business owner should obtain written confirmation of the amount owing and seek qualified tax and legal advice about the collection action and available arrangements.
Can Home Equity Be Used to Pay CRA Debt?
Lendworth offers CRA tax-arrears mortgage options for Ontario property owners with sufficient equity.
Depending on the circumstances, a cash-out refinance, second mortgage or private first mortgage may provide funds to pay an agreed CRA amount and cover approved business obligations.
A business equity loan may also be considered when capital is required for payroll, suppliers, inventory or another legitimate business purpose.
Mortgage proceeds are normally handled through lawyers and may be directed to CRA or other confirmed creditors as part of the closing.
Financing Must Support a Sustainable Recovery
A mortgage does not fix an unprofitable business or prevent future tax obligations from accumulating. Before borrowing, the owner should understand why the arrears developed and how ongoing remittances will be maintained.
The lender will review the property value, existing mortgages, CRA payout, business circumstances and repayment strategy. The exit may involve improved business cash flow, repayment of customer receivables, sale of another asset or eventual conventional refinancing.
If CRA collection action is threatening payroll or business operations, call Lendworth at 905-597-1225 or request a confidential business-equity review.
Your Equity Deserves More.