What happens to my tax refund?

An income tax refund for the year prior to the bankruptcy or for the current year up to the date of the bankruptcy would be considered part of a bankruptcy. It would be sent directly to the bankruptcy Trustee from CRA for the benefit of the creditors. In some cases a tax refund can be applied towards the bankruptcy fee. This must be clarified prior to the filing of the bankruptcy. In some cases we will apply tax refunds to the payment agreement. We are not able to apply tax refunds if you have Surplus Income, or are repurchasing assets from the bankruptcy. This should be discussed prior to the signing of the bankruptcy so it can be written on the payment agreement if tax refunds will be applied.