Small Business Debt Relief

Is Debt Impacting Your Small Business Revenue? Don’t Hide From Your Creditors. Let Us Help You Find the Best Debt Solution for Your Business.

Owning a small business has its perks – but dealing with your creditors isn’t one of them.

Are you having trouble paying CRA or your suppliers? Is there never enough cash in the bank to meet your obligations? Are your revenues declining? Are you hiding from the bank?

If you are experiencing any of these issues, give us a call and we will sit down with you for a FREE, no obligation consultation, and review your business’ cash flows and structure to advise you of the options available to you.

It’s time to explore debt settlement options for your business so you can focus on earning money instead of worrying about your creditors.

Book your free phone consultation with our caring team to discuss your options and start your journey towards financial freedom.

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You have invested both time and money into your small business venture and you don’t want to see it fail.

Regardless of the reasons your business is struggling, if you can’t pay your creditors, you risk losing both your source of income and any money you’ve invested in the business.

The experienced advisors at Spergel will review your financial situation, including your small business debts, cash flows, and loan obligations, during a FREE consultation. Our trusted Licensed Insolvency Trustees (“LITs”) are also seasoned Certified Professional Accountants (CPAs), who bring their accounting and operational skills to analyze and find solutions for your business. We also use our expertise as LITs to review your situation from both your business and personal financial perspectives.

Once we have a complete picture of your business’ finances and cash flows, we can help you explore your options. If a bankruptcy or a proposal is the best way to get things back on track, we will help you through the process. Whether you’re a sole proprietor or an incorporated entity, we will explore the options that will provide your small business with debt relief. You owe it to yourself – and your business – to let Spergel help you explore your options.

Devon’s Proposal – A Sole Proprietorship Small Business Debt Settlement

Devon’s seasonal painting business ran smoothly for years. However, Devon had not been paying his HST to CRA. One day he received a letter from CRA advising him of his accumulated Harmonized Sales Tax (HST) debt owing. As a sole proprietor he was personally liable for his business’ HST debt. Unable to repay his newly assessed HST balance and with penalties and interest quickly adding up – he got help from the team at Spergel. Devon negotiated a consumer proposal debt settlement, freezing all interest and penalties, and Spergel negotiated a reduced payment plan to CRA. In the end, Devon agreed to pay a monthly amount to CRA for a total that was significantly less than the balance he owed. He was able to avoid additional interest or penalties, and this allowed Devon to continue to operate his business. Devon was able to clear up his debts by working an affordable monthly proposal payment into his budget.

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Simone’s Incorporated Business Restructuring

Simone ran a corporation that employed 20 people, but an economic downturn in her industry forced her to lay off staff. Bills began piling up, suppliers weren’t being paid and orders weren’t being filled. Simone had also fallen behind in payments with her landlord. A Spergel Licensed Insolvency Trustee assessed her situation during a FREE consultation and provided her options with based on whether she wanted to continue to operate or close down her business. We performed an in-depth analysis of her business cash flow and earnings. We advised that her business was viable if she could reduce expenses in certain areas while adding product lines to increase revenues. Spergel explained that a Division I proposal would stay all her current creditors, allow her breathing room to restructure operationally and move forward. Let our decades of experience advising small business owners in tough situations help you too.

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Frequently Asked Questions:


I’m not an incorporated business, am I personally responsible for my business tax debt?


As a small business owner who is not incorporated, your company is in essence you personally, so there is no corporate tax return to file, but you must ensure you properly capture all income earned on your personal tax return. The good news is that since you are self-employed, you can deduct business expenses from the income earned to reduce your personal tax owing. If you earn greater than $30,000 in revenues in one calendar year, you will have to apply for an HST number, and file an HST return each year. Any amounts owing under HST are a personal debt of the small business owner.


I’m an incorporated business, am I personally responsible for my business tax debt?


As a small business owner who is incorporated, the corporation is a separate legal entity from yourself. You should open a separate bank account to deposit all revenue and pay all expenses out of the business bank account. This will help you keep your personal and business expenses and payments to yourself as owner separate from your personal accounts. You will need to prepare financial statements for the corporation and file a corporate (T2) tax return. You will also need to apply for an HST number and file an HST return. As a director of the corporation, you are personally liable for the HST owing to CRA, and any source deductions owing to CRA on behalf of employees. All other debts, including corporate tax debt, are not director’s liabilities. However, if you personally guarantee any of the corporation’s debts, those are also your personal liabilities.

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Can I continue operating a corporation if I file a personal bankruptcy to clear up my personal debts?


If you operate a corporation you can no longer be a director if you file a personal bankruptcy. However, once you are out of bankruptcy, you can be re-instated as a director. You may appoint someone else to take over – or cease operations under your corporation and operate as a sole proprietor instead. If you cannot resign as director or operate as a sole proprietor, you may want to consider a consumer proposal instead of a bankruptcy to deal with your personal debt problem(s). You can remain a director uninterrupted while in a proposal.

If you are not incorporated, a personal bankruptcy would include all of your business debts, as you and the business are one and the same and share responsibility for all debts.


Am I liable for my spouse’s business debts?


If your spouse’s business is not incorporated, all business debts are his/her personal debts. You would only be responsible if you have co-signed/guaranteed any loans or have joint accounts such as credit cards. If the business is incorporated, all business debts belong to the corporation. If you were a director of the corporation you would be responsible for HST and source deductions which are considered director’s liabilities and shared responsibility with the corporation. If your spouse’s business owes source deductions or HST to Canada Revenue Agency, know that non-payment could result in the registration of a lien against your home. While this doesn’t make you personally liable for your spouse’s business debt, it could impact your refinancing or the sale of your home if it isn’t rectified so that the lien can be removed.

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