Trust and Loans - Anyone have a definitive answer? Statute of Limitation? - Canada

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RE: Anyone have a definitive answer? Statute of Limitation?

Postby Ottawa_Chap » Thu Nov 01, 2012 07:05:44 PM

Hi Footloose... Interesting thread here. Thanks for the detailed info, and now I'm going to do some digging into "The Right To Set-Off" rules for the banks.

In a nutshell, I'm somewhat ignorant in the area. I understand the premise behind it, but, not all the nuts and bolts of the rules.

Cheers,

O.C.
Infuriating one C/A at a time..
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RE: Anyone have a definitive answer? Statute of Limitation?

Postby footloose » Thu Nov 01, 2012 01:35:42 PM

All Federal student loans are subject to a limitation provision. For those student loans that were issued up to and including July 31, 1995, the limitation provision is found in Section 19.1 of the Canada Student Loans Act. For student loans that were issued after July 31, 1995, the limitation provision is found in Section 16.1 of the Canada Student Financial Assistance Act. In both Acts, the limitation provision is 6 years.

For those student loans that have fallen into default, the Canada Revenue Agency ( CRA ) is now the official collection agency for the Federal government. As such, they are authorized to exercise their "right of set-off" under Section 164 of the Income Tax Act ( Canada) by withholding income tax refunds and the quarterly GST rebate and apply these amounts to the defaulted student loan.

However, once a student loan becomes "statute-barred", the Department of Justice ( Justice Canada ) will then issue a "Directive" to the CRA to cease using the "right of set-off". Once a student loan becomes "statute-barred", income tax refunds along with the quarterly GST rebate will be paid to the debtor upon the filing of an income tax return.

PLEASE NOTE

The limitation of the application of the "right of set-off" as it is applied to student loans does NOT apply to a debt owed to a bank. Banks can and will exercise their "right of set-off" even if a debt is "statute-barred". This practice is perfectly legal as there is no legislation preventing the banks from doing so.

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RE: Anyone have a definitive answer? Statute of Limitation?

Postby adnamA79 » Wed Oct 31, 2012 11:11:05 PM

Any GST taken toward it or such counts as a payment, as far as I know statute of limitations doesn't 'really' apply to the government BECAUSE they do the GST thing / take tax refunds as payments toward the loan, which keeps it from reaching stat barred.
adnamA
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RE: Anyone have a definitive answer? Statute of Limitation?

Postby frustratedincorporated » Mon Sep 17, 2012 06:31:43 PM

If any clarification is needed I will gladly reply.

Thanks again.
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Anyone have a definitive answer? Statute of Limitation?

Postby frustratedincorporated » Mon Sep 17, 2012 06:29:32 PM

According to my free TransUnion credit report I have a GOVERNMENT STUDENT LOAN with the last payment date of July 1, 2005. It was taken out in July of 2003.

It is rated as paid as agreed. (not accurate as could not afford to pay it) and the last payment was the govt taking my GST credits. It reads on the report that the account has been transferred.

What I want to know has the Statute of Limitations to sue me run out? Or does this not apply to the Government?

Any insight would be greatly appreciated.

Thanks so much!
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