DIRECTORS’ LIABILITY FOR UNREMITTED GST/HST
RESIGNING AS DIRECTOR TO AVOID CORPORATE INDIRECT TAX LIABILITY A TRICKY TASK
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The GST/HST framework under the Excise Tax Act (“ETA”), as with other indirect tax regimes (like federal and provincial alcohol, tobacco and vaping taxes) includes “directors’ liability” provisions that are triggered when the corporation does not have the money to pay an assessed amount. Most of these systems have “statutory limitation rules” and “due diligence defences” which may limit liability, but these rules are extremely tricky to apply in practice.
We review these in a two-part series here, with reference to the helpful recent case Stevens v. The King, 2026 TCC 76 (“Stevens”), which revolves around this directors’ liability framework.