Bankruptcy in Ontario
What Assets Can Be Kept By A Debtor In Ontario?
Bankruptcy regulations and rules in the province of Ontario is among the strictest in some ways as compared to the other provinces and territories.
What can be kept by an impending bankrupt in Ontario is pretty straightforward and they are set caps on all items of any particular value that a person may have.
These set caps are not negotiable and anything above those values that are set by the bankruptcy laws in Ontario will be seized by a trustee in bankruptcy and the value of that distributed among the creditors to whom you owe money to.
Let’s begin by looking at items of value that a bankrupt in Ontario may have and how these items of value can be affected by a bankruptcy filing Ontario.
Bankruptcy in Ontario and Clothing Items
In the first interview with a trustee in bankruptcy when declaring bankrupt in Ontario, the trustee will ask if there is value of clothing items in the home that is worth more than $5650. That is the limit set by the government of Ontario that can be kept when a person declares bankrupt. If the answer is yes the trustee will require a list of all the clothing items and will seize that which values more than $5650.
Bankruptcy in Ontario and Household Goods
Bankruptcy in Ontario and Tools of Trade
Tools and equipment that is required for employment purposes or other income generating activities will be allowed to be kept if the value of those tools and equipment is less than $10,000.
Bankruptcy Ontario and Farmers
Unlike some other provinces in Canada which allows farmers to keep a certain amount of acreage of land and the home on that land, and a certain amount of animals and seed grain, Ontario is not that lenient where bankruptcy is concerned.
For farmers unfortunately, everything that’s valued more than $25,000 will have to be handed over to the trustee in bankruptcy. If there is farmland, tools and equipment, grains and animals and anything else that is valued more than $25,000, all will be seized by a trustee in bankruptcy, sold, and the processes of that sale be distributed among those whom funds are owed.
Bankruptcy in Ontario and a Vehicle
The impending bankrupt in Ontario is allowed to keep one vehicle that valued less than $5650. As long as the vehicle is below this value you can keep it, unfortunately anything above that will have to be handed over to the trustee for seizure.
Bankruptcy in Ontario and Pensions
Pension contributions made within the last 12 months will be recovered and handed over to the bankruptcy trustee. However all other contributions made up to the last 12 months will be untouched and after the bankruptcy the contributions can be restarted.
Other than these last 12 months before the bankruptcy is filed, all other pensions are untouched which includes the RRSPs and RRIF’s.