I’ve recently been dealing with my father’s multiple years of unpaid taxes. He is retired, only has his CPP to live off of, owns no property, and has alzheimer’s. The size of his debt to CRA is making me think he may need to declare bankruptcy since he doesn’t even have money now for his basic care - if he does so, will he lose his pension and his life insurance policies?
Managing a senior parent’s debt
Posted on Saturday, April 21, 2007
posted by Questions @ 5:54 pm
1 Expert Comment:
At April 21, 2007 |
11:03 pm
, Barton Goth, GCO, Bankruptcy Trustees Said...
There are very specific rules about pension funds and life insurance so it is difficult to provide clear direction without knowing a few more details.
However, generally pension funds are protected as long as they are essentially annuities (i.e. your father has no ability to liquidate the pension, he simply is entitled to his allotted payemnts over time).
Insurance isn’t quite as straight forward, but as a general rule if the policies do not have a cash surrender value component to them then they to would be protected.
At this point the best thing for you to do is review the details of these policies with a local trustee and then you will have a better indication of how the rules will relate.
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