--- title: "Wage garnishment: How it works and what you can do" date: 2023-03-17T08:28:41-04:00 author: Braden Burritt canonical_url: "https://grantthorntonlimited.ca/en/debt-help-resources/articles/wage-garnishment-how-it-works-and-what-you-can-do" section: Articles --- [ Back to the hub ](https://grantthorntonlimited.ca/en/debt-help-resources/articles) # Wage garnishment: How it works and what you can do Braden Burritt CIRP, Licensed Insolvency Trustee ![Person holding past due bill that has led to wage garnishment](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/Web-image-square/_articleHero/6361/What-is-wage-garnishment-and-how-can-you-stop-it.webp) Braden Burritt CIRP, Licensed Insolvency Trustee P.E.I. is the first province to make changes to the cost-of-living calculations for wage garnishment orders. However, given record inflation and rising cost of living, more provinces may follow suit. Wage garnishment is the only debt collection method that has a direct impact on your income and can therefore play a major role in the cycle of debt and your finances. If you or someone you know is facing wage garnishment, check out these seven questions to stay informed and prepared: ## What is wage garnishment? A wage garnishment is a legal action where a creditor receives a portion of your income as payment for debt you owe. The laws around wage garnishment vary between provinces, but generally, a creditor must first prove their claim in court and receive a judgment against you. Once they’ve received the judgement, they apply for an order requiring your employer to pay a percentage of your earnings into the court and, through them, back to the creditor. ## How much of my income can be garnished? The amount of income that can be garnished differs based on your province of residence. Most provinces calculate garnishment based on your net income, and few allow for payments of more than 50%. Some provinces, like Alberta and P.E.I., also include an exempt amount intended to cover basic living expenses like housing, food, transportation, and other necessities for yourself and any dependents. However, many provinces have not updated these calculations in over a decade and have fallen behind the rate of inflation. There are a few cases where your garnishment could exceed provincial limitations. The Canada Revenue Agency (CRA) and child support debts can be garnished at a higher rate and collected in addition to any existing wage garnishment. Aside from these exceptions, multiple wage garnishments will not affect the amount you pay, and the paid funds will be split between creditors by the court. ## Can they seize other assets like my bank account, car, or house? A garnishment order can be served to your bank instead of your employer. This allows the creditor to seize money directly from your accounts and sometimes do so in larger quantities than a traditional wage garnishment. Additionally, if your pay is subject to an assignment of wages with a Credit Union, a court order isn’t required to begin garnishment. Wage garnishment is one of many potential legal actions creditors can take to recover their money. ## Does my employer have to comply with a wage garnishment? Once your employer has been notified, they have a duty to comply. If your employer fails to obey the order, they could be held liable for the amount they should have deducted from your personal income. The amount your employer can withhold from your paycheque will vary based on your province of residence and overall income. Whatever amount is deducted will be sent to the court and through them, to your creditor. Your employer is not allowed to fire you or make other decisions about your employment because of a garnishment order, but it can be a stressful situation. ## Is my wage garnishment public? Most wage garnishment orders are filed through the court system and are therefore a matter of public record. Though these records aren’t broadly publicized, they can be found through your local court and are often accessible online. Some creditors, such as the CRA, partners requesting child support, and credit unions with wage assignments, do not have to go through the court to garnish your wages making them less publicly visible. Credit reports also don’t share specific collection actions as part of their record, but the debt and amount owing will still be included. ## Can the CRA garnish my wages if I owe income tax debt? CRA follows different rules and processes when it comes to collecting tax debt. The CRA does not require a court order to garnish your wages but instead uses a requirement to pay. This has the same effect as wage garnishment, but the funds will be sent directly to the CRA. The CRA can also withhold your GST/HST, tax return, and Employment Insurance to pay off your debt. ## How can I stop a wage garnishment? Your first option to stop wage garnishment is to negotiate with your creditors and make a separate arrangement to pay off your debt. One way to do this is with a consumer proposal filed with a Licensed Insolvency Trustee. With a consumer proposal, you can consolidate all your debts into a single monthly payment and put a stop to interest payments, collection calls, and even wage garnishment. If you’re facing wage garnishment or struggling with debt, [book your free consultation](https://grantthorntonlimited.ca/en/get-in-touch/contact-us) today and start your road to debt freedom. About the Author Braden Burritt CIRP, Licensed Insolvency Trustee ## Latest articles [ ![](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbListSmall/67684/assets-CP-square.webp) ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-your-assets-in-a-consumer-proposal) [What happens to your assets in a consumer proposal? ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-your-assets-in-a-consumer-proposal) [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-your-assets-in-a-consumer-proposal) [ ![](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbListSmall/65155/recreational-vehicle-square.webp) ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-an-rv-boat-or-atv-loan-if-you-file-a-consumer-proposal-or-bankruptcy-in-canada) [### What happens to an RV, boat, or ATV loan if you file a consumer proposal or bankruptcy in Canada? ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-an-rv-boat-or-atv-loan-if-you-file-a-consumer-proposal-or-bankruptcy-in-canada) [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-an-rv-boat-or-atv-loan-if-you-file-a-consumer-proposal-or-bankruptcy-in-canada) [ ![](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbListSmall/63555/influencer-survey.webp) ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-influenced-into-debt-how-social-media-impacts-canadians-finances) [### Influenced into debt: How social media impacts Canadians' finances ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-influenced-into-debt-how-social-media-impacts-canadians-finances) [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-influenced-into-debt-how-social-media-impacts-canadians-finances) ## Subscribe to our newsletter Get tips and tools to help manage your finances and live debt free. \*I agree to receive communications from Doane Grant Thornton. I understand that I can unsubscribe at any time. ## **Take the first step** to debt freedom Speak to one of our debt solutions professionals during a free, no-obligation consultation. [ Book a free consultation ](https://grantthorntonlimited.ca/en/get-in-touch/contact-us) ## Related articles ![](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbMedium/67684/assets-CP-square.webp) ### [What happens to your assets in a consumer proposal? ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-your-assets-in-a-consumer-proposal) In most cases, a consumer proposal allows you to keep all of your assets while bankruptcy may require you to surrender certain non-exempt assets. [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-your-assets-in-a-consumer-proposal) ![Marina filled with sailboats and recreational boats along the Charlottetown waterfront on a sunny day.](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbMedium/65155/recreational-vehicle-square.webp) ### [ What happens to an RV, boat, or ATV loan if you file a consumer proposal or bankruptcy in Canada? ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-an-rv-boat-or-atv-loan-if-you-file-a-consumer-proposal-or-bankruptcy-in-canada) For many Canadians, recreational vehicles offer freedom, adventure, and unforgettable family memories. But if you’ve financed an RV, travel trailer, boat, ATV, snowmobile, or side-by-side, those monthly payments can become difficult to manage if life takes an unexpected turn. [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-to-an-rv-boat-or-atv-loan-if-you-file-a-consumer-proposal-or-bankruptcy-in-canada) ![A woman in scrubs sitting on a park bench looking at her phone, with imagery of social media likes and spending surrounding her.](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbMedium/63555/influencer-survey.webp) ### [ Influenced into debt: How social media impacts Canadians' finances ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-influenced-into-debt-how-social-media-impacts-canadians-finances) While social media may be free to use, the things it influences us to buy often come at a cost. As influencer marketing continues to grow, more Canadians are making purchases based on what they see online. [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-influenced-into-debt-how-social-media-impacts-canadians-finances) ![A woman sitting with papers and a calculator in front of her](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbMedium/63201/cp-annulment-square.webp) ### [ What happens if you miss a consumer proposal payment? ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-if-you-miss-a-consumer-proposal-payment) Missing a payment during your consumer proposal can feel scary—but it’s not the end of the road. This article explains exactly what happens if you miss a consumer proposal payment, how to avoid annulment, and what to do if your consumer proposal is annulled. [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-if-you-miss-a-consumer-proposal-payment) ![A young woman sits with and supports an older woman holding a cane.](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/Web-image-square/_articleThumbMedium/58677/caregiver-article-square.webp) ### [ Tips to avoid debt as a family caregiver in Canada ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-tips-to-avoid-debt-as-a-family-caregiver-in-canada) With the rising cost of living and long waitlists for long-term care, more Canadians are becoming family caregivers, but it can come with an emotional and financial cost. [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-tips-to-avoid-debt-as-a-family-caregiver-in-canada) ![Person packing a box for moving](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbMedium/57664/adult-child-moving-home-square.webp) ### [ How to budget when your adult child moves back home ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-how-to-budget-when-your-adult-child-moves-back-home) Adult children moving back home isn’t just a trend—it’s quickly becoming the norm. While the cost of living continues to climb across Canada, many Gen Z and millennial Canadians are packing up their apartments and returning to the nest as “boomerang kids.” [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-how-to-budget-when-your-adult-child-moves-back-home) ![Person looking down at bills with head in hand, surrounded by paperwork and an open laptop.](https://pr-assets.grantthorntonlimited.ca/craftcmsimages/Article-imagery/_articleThumbMedium/56923/utilities-square.webp) ### [ What happens if you don’t pay your utility bills in Canada? ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-if-you-dont-pay-your-utility-bills-in-canada) If you’re worried about unpaid electricity, heating, or water bills, you’re not alone. But disconnection isn’t immediate, and you usually have options to protect your service while you get back on track. [ Read this article ](https://grantthorntonlimited.ca/en/debt-help-resources/articles/article-what-happens-if-you-dont-pay-your-utility-bills-in-canada)