Last updated: September 2026
Wage garnishment laws in Canada decide how much of your paycheque a creditor can take before it reaches you. If you have received a notice of garnishment, the fear is real — but garnishment is capped by provincial law, cannot cost you your job, and can be stopped completely once you know which tools apply.
Canadian Debt Relief is an independent Canadian guide to debt relief options — consumer proposals, debt management plans, debt consolidation and bankruptcy — for people who want to understand their choices before they talk to anyone.
What is wage garnishment in Canada?
Wage garnishment is a legal order that requires your employer to deduct a set portion of your pay and send it to a creditor you owe. It is a last-resort collection tool, used after normal collection has failed and, for most debts, only after a court has confirmed the amount.
Ontario’s Wages Act states that 80% of a person’s wages are exempt from seizure or garnishment, which is why 20% is the ceiling for most Ontario garnishments; every other province and territory has its own statute and percentage. Your employer must comply but cannot fire you over it. For a worked example, see our guide to wage garnishment in Ontario.
Who can garnish your wages in Canada, and do they need a court order?
Three groups can garnish wages in Canada: private creditors such as banks, card issuers and collection agencies; provincial family support enforcement agencies; and the federal government through the CRA. Private creditors always need a court judgment first; the CRA and support enforcement agencies do not.
For a credit card, loan or old phone bill, the creditor must sue you, win (or get a default judgment because you never responded), then apply for a garnishing order. That takes months, so a garnishment for consumer debt should never be a surprise. A collector threatening to garnish you “by Friday” without a judgment is bluffing — see whether a collection agency can garnish your wages.
The CRA’s 2026 guidance on processing a garnishment confirms that for income tax, GST/HST and payroll debts it sends a Requirement to Pay straight to your employer or bank with no court order. Support arrears are enforced by provincial agencies that can also garnish without suing you first.
How much of your pay can be garnished in Canada?
For ordinary consumer debt the cap is 20% of net wages in Ontario, 30% in British Columbia, and a similar range elsewhere, while support orders can take up to 50%. Garnishment applies to net pay after tax, CPP and EI, not your gross salary.
Ontario’s Wages Act sets 20% for ordinary debts and 50% for support. British Columbia’s Court Order Enforcement Act exempts 70% of wages, with a protected floor for low earners and people with dependants. Alberta and Saskatchewan protect a fixed monthly amount plus an allowance per dependant; Quebec exempts a base amount and then protects 70% of the rest.
CRA garnishments follow the federal Income Tax Act instead: the CRA’s employer instructions say a Demand on a Third Party takes 30% of net pay until the debt is cleared, and an Enhanced Requirement to Pay can take up to 100% of payments such as bonuses or contractor invoices. Provincial caps also do not protect money already in a bank account.
Should you let a garnishment run its course?
Only when the debt is small and you can absorb the deduction without falling behind elsewhere. For most people the answer is no, because garnishment repays the debt at the slowest legal pace while post-judgment interest keeps accruing.
Who should act right away, and who can wait?
Act immediately if the garnishment comes from the CRA, if more than one creditor is suing you, or if the deduction leaves you unable to cover rent and groceries. Waiting and simply paying is reasonable if the debt is a few thousand dollars and you are current on everything else.
- You owe income tax or GST/HST and have received a Requirement to Pay — the CRA takes 30% of net pay with no judgment.
- You have $10,000 or more in unsecured debt across several creditors, because each can obtain its own judgment.
- The garnishment plus your other minimum payments exceeds what you bring home.
- The judgment is small and will clear within a few months at the legal cap.
- No other debts are in arrears and no further lawsuits are likely.
What does a garnishment cost compared with a consumer proposal?
On $18,000 of judgment debt with $3,200 in monthly net pay, an Ontario garnishment at 20% takes $640 a month for about 28 months before interest, while a consumer proposal on the same $18,000 typically settles for $6,000 to $7,500 over 60 months at roughly $100 to $125 a month — and covers every other unsecured debt too.
Figures are rounded and a proposal amount depends on your income and assets. Support arrears cannot go into a proposal, but CRA debt can — see our guide to a consumer proposal for tax debt.
How do you stop a wage garnishment in Canada?
The fastest legal way to stop a wage garnishment is to file a consumer proposal or bankruptcy, which triggers an automatic stay of proceedings under section 69 of the Bankruptcy and Insolvency Act on the day of filing. Paying the judgment in full, negotiating a voluntary arrangement, or asking the court to reduce the percentage are the slower routes.
Only a Licensed Insolvency Trustee can file a consumer proposal or bankruptcy, and the trustee sends the stay notice to your employer and the creditor; check our guide to consumer proposal eligibility. A debt management plan carries no legal stay, though many creditors withdraw a garnishment once the plan is accepted.
- Read the order and confirm the numbers. Check the creditor, the judgment amount, and that the percentage matches your province’s cap.
- List every debt, not just the one being garnished.
- Contact the creditor if the debt is small. Many will lift a garnishment for a signed voluntary plan that pays faster than the cap allows.
- Book a free consultation with a Licensed Insolvency Trustee if the debt is large or the CRA is involved. The trustee compares a proposal, bankruptcy and a debt management plan against your income and assets.
- File, then confirm the stop on your next pay stub. The stay takes effect on the filing date and the trustee notifies your employer; if the deduction continues, send the notice to payroll again.
Ready to see if you qualify?
What else do people ask about wage garnishment?
Can a creditor garnish my wages without going to court in Canada?
A private creditor cannot; it must sue you and obtain a judgment first. The CRA and provincial support enforcement agencies can garnish without a court order.
Can I be fired for having my wages garnished?
No. Provincial wage and employment standards laws across Canada prohibit an employer from dismissing, suspending or laying off an employee because of a garnishment. Any discipline tied to a garnishment can be challenged with your provincial employment standards branch.
Does a consumer proposal stop a CRA wage garnishment?
Yes. On $15,000 of income tax debt, filing a consumer proposal triggers the stay under the Bankruptcy and Insolvency Act, and the CRA’s guidance tells employers to stop the garnishment once the trustee confirms the filing in writing. The tax debt is then repaid through the proposal, typically at $75 to $125 a month over 60 months.
Can two creditors garnish my wages at the same time?
Yes, but the combined deduction cannot exceed your province’s cap for that type of debt. In Ontario, two ordinary creditors share the 20% of net wages, while a support order has its own 50% limit; the CRA’s policy gives priority to a competing child-support garnishment.
How long does a wage garnishment last in Canada?
A garnishment lasts until the judgment, court costs and post-judgment interest are paid, or until it is stopped by a consumer proposal, bankruptcy or court order. On a $6,000 judgment with $2,800 in monthly net pay at a 20% cap, that is $560 a month for roughly 11 months plus interest.
After 20 years of structuring multi-million dollar corporate debt facilities and corporate turnarounds in investment banking, Marcus now leads Canadian Debt Relief to apply those exact same balance-sheet optimization frameworks to Canadian household debt.
