November 20, 2017

Directors of a corporation can be held personally liable for HST and employee source deductions. Even if a director would be considered an “outside director,” meaning they have no day-to-day involvement in the company, they still may be held liable jointly and severally with the corporation. Directors with minimal financial experience or know-how may not be spared director’s liability solely for those reasons.

Where the CRA tries to hold a director personally liable for HST or employee source deductions, the only real defense for the director is the due diligence defense. There is a large body of case law on this topic. The CRA will determine objectively if you acted reasonably in the given circumstances. We are seeing the CRA become more aggressive in pursuing directors personally for amounts not remitted by the corporation. There is a defense. If the CRA is trying to hold you personally responsible for amounts the corporation failed to remit or if you believe the corporation you are a director of may not be able to meet their remittance obligations soon we can assist you. For more information contact us at 416-493-0444 or e-mail the head of our audit and appeal department at

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