How to Pay Out a Revenue Canada Lien
A tax lien is never welcome. If you have carried significant Canada Revenue Agency debt for a long time without paying it, a Revenue Canada lien may be unavoidable. The government prefers not to take legal action, but an ignored debt eventually pushes it to register a claim on the title of your property. This page focuses on how to pay out a Revenue Canada lien and get it discharged. For the mechanics of how a lien works, see our Revenue Canada debts and liens guide, and for the full range of options, our guide on paying off CRA debt using home equity.
Short answer: The most common way to pay out a Revenue Canada lien is to borrow against your home’s equity through a refinance or a second mortgage, direct the funds to the CRA to clear the certified debt, and have the lien discharged from your title. Because approval is based mainly on your equity rather than your credit or income, it often works when a bank has said no, and it lets you clear the lien without an insolvency event on your record.
Paying out a lien at a glance
CRA interest rate: Canada.ca, Q3 2026. Lending figures are typical and vary by file.
Why a Revenue Canada Lien Needs to Be Paid Out
A Revenue Canada lien is only registered when a tax debtor fails to pay, and it can do real damage if left alone. The most immediate risk is your mortgage renewal: when your first mortgage comes up for renewal, your existing lender may decline to renew once they see the Canada Revenue Agency has registered a lien against your home. Left unresolved long enough, the CRA can pursue a forced sale of the property to recover the debt. The good news is that equity is the key, and you likely have some, because the CRA would not have registered a claim against your title otherwise.
Your Options to Pay Out a Revenue Canada Lien
There are a few ways to pay out a lien, and the best one depends on your circumstances. Here is how the common paths compare on what matters most: keeping your home and protecting your retirement.
| Method | Keeps your home? | Protects retirement savings? | Notes |
|---|---|---|---|
| Refinance or second mortgage | Yes | Yes | Fastest route, and a second mortgage keeps your first intact |
| Liquidate an RRSP | Yes | No | Withdrawal is taxable and permanently reduces retirement savings |
| Borrow from family | Yes | Yes | Not always available, and can strain relationships |
| Sell the home | No | Yes | Clears the lien but means giving up the property |
| CRA payment arrangement | Yes | Yes | Interest keeps compounding and it can be hard to negotiate |
Of all of these, refinancing or a second mortgage usually gives you the most control: it preserves your retirement savings, lets you keep your home, and avoids awkward conversations with family. Even with bad credit or a recent job loss, if there is equity in your home, we can find a lender who will help you clear the debt.
Should You Ask Your Bank First?
Usually the bank is not the answer here. Most traditional banks will not refinance a home to pay out a Revenue Canada lien, which is exactly why homeowners in this situation turn to alternative and private lenders. The value of a broker is knowing which lenders allow these payouts, and there are many. If breaking your first mortgage would trigger large penalties, a second mortgage or secured line of credit behind it lets you clear the lien while leaving your first mortgage and its rate untouched, and works around the stricter stress-test rules the big banks must follow.
How the Lien Gets Discharged After You Pay
Once the CRA is paid in full, the lien is released. Here is how the payout and discharge typically unfold when funded through a home equity loan or refinance.
There is also the insolvency route to consider, but if you have equity you can pay out the lien without a bankruptcy or consumer proposal on your record. It is worth knowing that bankruptcy typically cannot remove a CRA lien on its own, because a registered secured claim is treated separately from unsecured debts like credit cards, so for many homeowners with equity, a payout is both cleaner and less costly.
Lien registered on your property?
Pay out your Revenue Canada lien with your home’s equity, even if the bank said no.
or call 1-855-668-3074
Working With TurnedAway to Pay Out a Lien
We have years of experience helping people in exactly this situation. We are well-versed in equity-based lending: we do not disqualify you for bad credit or unpaid bills, and we look at your equity rather than leaning on your credit report. Whether the Revenue Canada lien is on a home, commercial property, or vacant land, if you have enough equity we can help you clear it and get a fresh start.
