Can I get a mortgage in Ontario if I owe the CRA?

Usually yes, but it changes the order of operations. Most lenders want the balance cleared at closing or covered by a formal CRA payment arrangement. Owing tax is not disqualifying on its own; failing to disclose it is far more damaging.

What happens if the CRA has registered a lien on my property?

A registered CRA lien narrows the lender list considerably, because it can sit ahead of a lender's security. It usually has to be cleared through the transaction, and your lawyer becomes central to arranging that.

Answers › Self-Employed Mortgages

I owe the CRA. Can I still get a mortgage?

Q: Is owing tax or not filing returns the bigger problem for a mortgage?

Unfiled returns are the bigger problem. Without assessed returns and Notices of Assessment, an A lender has no income figure to work with at all. A balance owing is a number a lender can plan around; missing returns leave nothing to assess.

Answered by Rajiv Verma, Mortgage Broker · Reviewed September 2026 · About a 4 minute read

The direct answer

Usually yes — but it changes the order of operations. Most lenders want the balance cleared or formally arranged before closing, not after. What makes a CRA balance dangerous is leaving it unmentioned, not owing it.

THE SHORT VERSION

Owing tax is common among self-employed borrowers and lenders know it
Unfiled returns are a bigger problem than unpaid ones
A CRA lien registered on your property changes everything
Some lenders accept a formal payment arrangement; others want it paid at closing
Disclose it early — it almost always comes out anyway

Why it matters to a lender

The CRA has collection powers most creditors do not. It can register a lien against your property, and that lien can sit ahead of a lender’s security. A lender is not judging you for owing tax — it is protecting its position.

Which is why the questions they ask are narrow: how much, is it filed, is there a lien, and what is the plan.

The four situations, in order of difficulty

1. Filed and paid, nothing owing. No issue. Your Notices of Assessment do the talking.

2. Filed, with a balance owing and no lien. Workable. Some lenders will proceed with a formal CRA payment arrangement in place; others will want the balance paid out of the mortgage proceeds at closing. Both are routine.

3. Filed, with a lien registered. Harder, and it narrows the lender list considerably. It usually has to be cleared through the transaction, and your lawyer becomes central to the file.

4. Returns not filed. This is the genuinely difficult one. Without assessed returns, an A lender has no income figure to work with at all. Filing is normally the first step, ahead of any mortgage conversation.

People assume unpaid tax is the problem. More often it is unfiled tax. A balance owing is a number a lender can plan around. Missing returns leave them with nothing to assess, and no amount of good intention substitutes for a Notice of Assessment.

What tends to help the file

Returns filed and assessed, even if the balance is unpaid
A written CRA payment arrangement you are current on
Enough equity that the balance can be cleared through the mortgage if required
A clear, short explanation of how the balance arose — a strong year, a missed instalment, a business change
An accountant who can confirm the current position

If refinancing is the route

Where there is equity in the home, clearing a tax balance through a refinance is a common and sensible solution — the debt with the strongest collection powers gets retired first. Whether that is the right call depends on your rate, your remaining term and any prepayment penalty.

If the balance is large relative to your equity, or a second position is a better fit than breaking your current mortgage, that is a different conversation — see using a second mortgage to clear CRA arrears.

When this is the wrong move

When the balance is small and payable. Restructuring a mortgage to clear a modest amount you could pay from cash flow rarely makes sense once costs are counted.

When returns are not filed. Chasing lenders before filing wastes weeks. File first.

When the underlying pattern has not changed. If the balance rebuilds every year, clearing it once through your home equity moves the problem rather than solving it. That is worth addressing with your accountant alongside the mortgage.

What to do next

Tell me the balance, whether the returns are filed, and whether anything is registered on title. Those three facts decide which lenders are open to you — and I would rather know them at the start than find them at the lawyer’s office.

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Related questions

Answered by Rajiv Verma, Mortgage Broker · Mortgage Architects — FSRA Brokerage Licence #12728 · Licensed in Ontario · Office 289.505.0631 · Direct 647.291.7116

General information about Ontario mortgages — not financial, tax, legal or mortgage advice. Speak to your accountant about tax matters and a lawyer about anything registered on title. Lender requirements vary. Every file is reviewed individually.