Ontario Bankruptcy Exemptions

(Assets you keep in a Bankruptcy or Proposal)

 

Ontario bankruptcy exemptions include up to $34,000 of equity in assets, in addition to certain pension plans and insurance policies.

In addition, to company pension plan amounts, RRSPs in insurance companies, and cash surrender value of life insurance policies where the beneficiary is your spouse, child, grandchild, or parent, your Ontario bankruptcy exemptions will include the items listed below. Most other assets are valued by the trustee and sold unless you make arrangements with the trustee to keep and pay for them. You might also be able to keep assets secured by a bank or finance company if you make arrangements with the creditor.

The property exempt from seizure (Ontario Bankruptcy Exemptions) is set by the province of Ontario and applies to the equity in the asset.

Equity is the excess that the value of an asset has over any charges or encumbrances against that asset.

For example, if you have a car worth $7,000 and there is a $2,000 secured debt against it then the equity in the car is $5,000. Ontario bankruptcy exemptions for a car is $5,650 so in this example you are entitled to the equity of $5,000 and the unsecured creditors cannot take this.

Ontario Flag Ontario bankruptcy exemptions are:

Exemptions

Ontario

Personal effects

$5,650

Household furnishings

$11,300

Tools of the trade

$11,300

Automobile

$5,650

Principal residence

$0
  • Effective July 7, 2008 exemptions are in effect for all registered retirementsavings plans (RRSP's, RRIF's and DPSP's (Deferred Profit Sharing Plans).
    • Contributions made in the 12 months prior to the date of bankruptcy will be recovered (clawed back) for the benefit of the bankruptcy estate for RRSPs in provinces without RRSP exemption laws (BC, Alberta, Ontario, NB, and NS);
    • There will be no upper cap on the amount of RRSPs that can be protected;
    • There will be no need to set up the RRSPs in a locked in plan to make them eligible for exemption;
    • The court will have no jurisdiction to extend the one year claw back period period in an appropriate case.

 

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