March 4, 2003 decision of the Supreme Court of Canada decided that limitations applied to CRA as well as other Crown proceedings. Section 3 (5) of the BC Limitation Act and Section 32 of the Crown Liability and Proceedings Act barred collection of the Provincial and Federal portions of the debt since the debt was more than six years old.
The following is the Statute Of Limitations laws for the Federal Government and Provinces in Canada
British Columbia - Section 3 (5) of the BC Limitation Act sets six years as the limit for debt.
Alberta - The Alberta Limitations Act sets two years as the term which is extended to ten years if there is a judgment.
Ontario - The Ontario Limitation Act 2002 , came into force on January 1, 2004. It sets two years as the term (Section 4). This limitation will be reinstated where the debtor acknowledges the debt or makes a partial payment towards repayment of his debt. If the default occurred prior to January 1, 2004, the creditor will continue to have six years to pursue the claim. However, if the default occurred after January 1, 2004 then the two-year rule applies.
Federal - Section 32 of the Crown Liability and Proceedings Act sets six years as the limit for debt.
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