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Tax and Revenue Administration
Fuel Tax Act
Information Circular FT-

Released/Last Updated: February 9, 2017
Produced by: Alberta Treasury Board and Finance, Tax and Revenue Administration
For more information: tra.revenue@gov.ab.ca

FT-8/ March 2007


(Effective April 1, 2007)

NOTE: This Information Circular is intended to explain legislation and provide specific information. Every effort has been made to ensure the contents are accurate. However, if a discrepancy should occur in interpretation between this Information Circular and governing legislation, the legislation takes precedence.

The Government of Alberta recognizes that many First Nations people and communities in the province prefer not to describe themselves as Indians/Indian bands. These terms have been used where necessary to reflect their legal meaning in the federal Indian Act.

This Information Circular explains Tax and Revenue Administration's (TRA) collection process for assessed fuel tax balances and other amounts owing under the Alberta Fuel Tax Act (the Act). Topics include:


  1. ”Person” includes an individual, corporation, partnership, trust or an Indian band.


  1. TRA normally sends a reminder notice to a person that does not make payment within 30 days of assessment. If TRA does not receive an appropriate response, a demand for payment may be mailed to the person. This demand will inform the person that legal action may result if payments, or satisfactory arrangements for payment, are not made within the time period stated in the demand.

  2. Persons who are unable to pay as required and seek a time extension must contact the Collections Unit of TRA. An extension will not usually be granted unless TRA is convinced that immediate payment would cause extreme hardship. Interest continues to accrue on the unpaid balance.

  3. If a person is unable to make immediate full payment, TRA may request security for the amount owing. The acceptance of security by TRA does not relieve the person from the obligation to pay amounts owing according to any arrangements agreed to by TRA. The full cost of providing security is borne by the person and interest continues to accrue on the unpaid balance.

  4. Requests for return of security held by TRA must be made in writing. Security may be returned to the extent that its value exceeds amounts owing by the person.

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Set off

  1. If, pursuant to the Act, a person has a refund due from TRA, and that person also has a debt with TRA, or with another Alberta government department, TRA may apply the whole, or any part of, the refund due to the person against the debt, instead of providing a refund to the person.

Certificate of amount not paid

  1. TRA may register a certificate of the amount owing with the Court of Queen's Bench. The certificate has the same force and effect as a judgment of the Court. Once a certificate is registered, TRA can register a writ and proceed to seize the person's assets. Costs related to the action, and interest, are recoverable from the person, in addition to the amount of the debt registered.

  2. TRA may register a certificate before the 30 days allowed for payment of an assessment elapses. To do so, TRA must file an application with the Court of Queen's Bench demonstrating that there are reasonable grounds to believe that the collection of all, or any, amount assessed against a person would be jeopardized by a delay in collection. Generally, TRA must serve an authorization granted on the person within 72 hours of it being granted. The authorization must be served personally or in accordance with the directions, if any, of a judge.

Third party demands

  1. Where TRA has knowledge or suspects that a third party is, or will be, liable within one year to make a payment to a person, TRA may intercept payments the third party makes to the person.

  2. If TRA has knowledge or suspects that within 90 days an institution will lend or advance money to, make payment on behalf of, or make a payment for a negotiable instrument issued by, a person, TRA may intercept amounts lent, advanced, or paid by the institution to the person. For this purpose institution means a bank, credit union, trust corporation, loan corporation, or other similar entity.

  3. If TRA has knowledge or suspects that within 90 days a person, other than an institution (lender), will lend or advance money to, or make payment on behalf of, a person, and the person is:

    • employed by, or is engaged in providing services or property to, the lender, or was or will be, within 90 days, so employed or engaged; or
    • in the case of a corporate lender, not dealing at arm's length with the corporate lender,

TRA may intercept amounts lent, advanced or paid by the lender to the person.

  1. To intercept amounts, TRA must serve a notice, in writing, on the third party, institution or lender requiring that the funds be sent to TRA rather than to the person. A third-party demand may be served on the person by personal service, fax, registered or regular mail.

  2. Whereas the funds under a garnishee issued under a judgment are paid to the court, under a third party demand the funds must be paid directly to TRA and TRA does not share the funds received with judgment creditors. If a third party, institution or lender fails to pay the funds to TRA and makes payment to someone else, then the third party, institution or lender becomes liable for the amount that should have been paid to TRA and will have to retrieve the money paid in error to the other party.

  3. After service of a notice, the institution is not permitted to set off amounts owing from the person to the institution against the person's assets held by the institution.

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Transfers by insolvent person

  1. If a person who owes an amount under the Act (debtor) transfers property to a person (transferee) with whom the debtor does not deal at arm's length at the time of the transfer, and the debtor is:

    • insolvent, or
    • becomes insolvent as a result of the transfer, or
    • becomes insolvent because of the transfer together with one or more other transactions with the transferee,

the transferee is jointly and severally liable with the debtor to pay the amount owing to TRA, to the extent that the fair market value of the property transferred exceeds the consideration given for the property.

  1. Back to back transfers of property amongst non-arm's length persons are included under these provisions as well. However, it must be reasonable to conclude that a subsequent transfer was undertaken to prevent the enforcement of these provisions. A transferee cannot avoid liability under these provisions by simply transferring the property on to another non-arm's length person. Each non-arm's length person in the series of transfers will become jointly and severally liable with the debtor to pay the amount owing to TRA.

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Directors' liability
  1. Where a corporation does not remit tax payable by it, the directors of the corporation (at the time the corporation was required to remit the tax) are jointly and severally liable, together with the corporation, to pay the tax owing and any related penalties and interest (the debt).

  2. If a director exercised due diligence to ensure that the corporation remitted the tax, that director is not liable for the debt.

  3. TRA may not take action to collect a debt from a director until:

    1. TRA has made all reasonable attempts to collect the amount from the corporation; and
    2. the director has been notified in writing, within two years after ceasing to be a director, of that director's liability.

  4. To demonstrate its inability to recover a debt from a corporation, TRA must:

    1. show that a certificate for the corporation's liability has been filed in the Court (see paragraph 7) and after execution of the certificate the debt remains unsatisfied, in whole or in part;
    2. prove a claim against the corporation in dissolution or liquidation;
    3. prove a claim against the corporation in bankruptcy; or
    4. show that a compromise or an arrangement has been proposed under the Companies' Creditors Arrangement Act (Canada) in respect of the corporation.

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Responsible representative's clearance certificate

  1. A “responsible representative” is a person who administers, winds up, controls, or otherwise deals with the property or business of another person. A responsible representative can be a trustee in bankruptcy, assignee, liquidator, administrator, receiver, receiver-manager or any similar person.

  2. Under the Act, a responsible representative has to obtain a clearance certificate from TRA before distributing property that the responsible representative controls as a responsible representative. A clearance certificate certifies that all amounts for which a person is, or can reasonably be expected to become, liable under the Act at, or before the time of distribution, have been paid, or that TRA has accepted security for payment.

  3. If a responsible representative distributes property without a certificate, that responsible representative is personally liable for a penalty equal to the value of the property distributed and TRA may assess that responsible representative for this amount.

  4. The certificate applies to amounts for which the responsible representative is, or may become, liable for payment. This includes all fuel taxes and/or other amounts owing, along with any interest and penalties.

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