Director Liability Exposure Checker
Payroll source deductions and net GST/HST can be assessed against directors personally. Corporate income tax on its own cannot.
Written and reviewed by Sharad Gondaliya, CPA (Ontario), CPA Ontario Membership 61040184.
Last reviewed: October 29, 2026
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Gondaliya CPA Professional Corporation is a registered EFILE electronic filer. Returns are prepared and transmitted in Canada. Credentials are never shared and never used offshore.
The Pattern Is Money That Was Never the Corporation’s
Certain amounts a corporation was required to withhold or collect and remit can be assessed against its directors personally. Payroll source deductions and net GST/HST are the two that matter here.
The reason is that the money was never the corporation’s to keep. Source deductions were withheld from someone’s pay and GST/HST was collected from customers, both on the Agency’s behalf. Corporate income tax is different: it is the corporation’s own liability, and on its own it does not reach a director.
| Amount | Whose money it was | Can be assessed against a director |
|---|---|---|
| Payroll source deductions | Withheld from someone’s pay | Yes |
| Net GST/HST | Collected from customers | Yes |
| Corporate income tax | The corporation’s own liability | No, not on its own |
Why This Reaches Dormant Corporations
A dormant corporation rarely owes corporate income tax, because a nil year assesses at $0.00. What it often has is an account nobody closed: a payroll account from when it had staff, or a GST/HST account from when it was registered.
While those accounts are open they keep generating obligations, and the amounts they generate are exactly the ones that reach directors. That is the practical case for closing them rather than ignoring them.
A true nil return carries no percentage late-filing penalty, because that penalty is a percentage of tax owing and the corporation owes $0.00. The unfiled year still stays open forever, invites a demand to file and an arbitrary assessment, blocks a clearance certificate and dissolution, and costs a non-resident-owned corporation $25.00 per day up to $2,500.00.
Closing the Accounts Is What Ends It
Form RC145 closes a GST/HST account and a payroll account. Until an account is closed, nil returns and nil remittances remain due on it, separately from the T2.
Neither closure is covered by the nil T2 fee. The GST/HST account closure checker and the payroll nil remittance checker each cover one of them.
What This Checker Is Not
It sorts three kinds of amount into the ones that can reach a director and the one that does not. It does not assess whether a particular director is liable, which turns on facts about the director and the period that no web page can take in.
Where an assessment has been raised or threatened against a director personally, that is a matter for Gondaliya CPA Professional Corporation at gondaliyacpa.ca rather than a form on this site.
Frequently Asked Questions
Which corporate amounts can reach a director personally?
Amounts the corporation was required to withhold or collect and remit, including payroll source deductions and net GST/HST.
Does corporate income tax reach directors?
Not on its own. It is the corporation’s own liability, collectible from the corporation, and the Agency has statutory collection powers it can use without going to court.
Why does this matter to a dormant corporation?
Because a nil year owes no corporate income tax but an unclosed payroll or GST/HST account keeps generating exactly the amounts that do reach directors.
How do I end the exposure?
Close the accounts. Form RC145 closes a GST/HST account and a payroll account, and until then nil returns and nil remittances remain due on them.
Is an assessment against me personally covered here?
No. That turns on facts about the director and the period, and it is a matter for Gondaliya CPA Professional Corporation at gondaliyacpa.ca.
Nil T2 Filing, $300.00 plus HST per tax year
Type your corporation name, pick your unfiled years, pay, and sign Form T183CORP on a secure screen. Your CRA confirmation is emailed within 3 business days.
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