Cashed out RRSPs over just over a year ago
I cashed out my RRSPs a little over a year ago in order to pay my father back for a loan that he demanded payment on. Now I think I need to declare bacnkruptcy. Will my father have to be contacted to confirm that I paid him this money? Will he have to give it back and become one of the bankruptcy creditors? Is there any way I can avoid my father knowing that I am declaring bankruptcy?
What you have done may be viewed as a fraudulent preference and be attackable under the Bankruptcy and Insolvency Act or alternatively under provincial legislation. As these statutes contain significant variations in time across the country you would be best to contact a local trustee to discuss the details of this type of transaction so you will be able to determine whether or not this will play an issue in your jurisdiction.