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What Happens to my Assets in a Personal Bankruptcy?

A common misconception of Bankruptcy is that you’ll need to surrender all of your belongings. Thankfully, this is far from the truth: Personal Bankruptcy exists for the benefit of the debtor and the creditors, and has measures in place to ensure that you are left with enough to maintain a reasonably comfortable lifestyle.


In a Bankruptcy, you are allowed to keep assets up to a certain dollar value. These assets are called “exemptions”, and include:

  • Household Furnishings – $13,150. This covers everything that is used to furnish your house, including appliances, electronics, dishes, televisions, decorative artwork, etc. In many cases, this allowance is enough to cover the entire household.
  • Tools of the Trade – $11,300 and Farming Tools – $29,100. These exemptions are both for self-employed tradesmen, and can include tools, trade-related vehicles, etc.
  • Automobile – $6,600. This exemption will cover a basic vehicle.
  • Primary Owned Residence – Up to $10,000. This is the difference between the mortgage owed on your house and its current value. During your free consultation with Fuller Landau, we can explore this with you in greater detail.
  • Personal Effects – $5,640. This can include anything that doesn’t fall under the other categories, such as clothing, accessories, etc.
  • Life Insurance and Pension Plans. While these are both commonly exempt, there are exceptions, and these should therefore be considered on a case-by-case basis. If you’d like to know if your insurance and pension plans are exempt, feel free to contact us for a consultation.

RRSP Contributions

While company pension plans are often exempt, RRSP contributions are also exempt except the amounts added in the year immediately before Bankruptcy.


Many types of investments are not exempt from Bankruptcy. Any Canada Savings Bond contributions will be realizable, regardless of when they were made. Any shares or stock that you hold in a corporation will also be considered part of your Bankruptcy estate, and may need to be turned over to your Trustee for disbursement.

Contrary to Personal Bankruptcy Myth…

Many fear that a declaration of Bankruptcy can ruin their livelihood. However, with the many exemptions in place, this is actually quite far from the truth. Bankruptcy is meant to free you from debt, not ruin you.

If you think you may need to file for Bankruptcy, or if you’d like to learn more about Bankruptcy exemptions, please contact us today for a free consultation.


Consumer Proposal vs Bankruptcy

Can You Relate?

When it comes to debt, particularly high-interest debt from credit cards, a few missed payments can often become a slippery slope towards out-of-control debt.

Minimum payments barely cover the interest. If those minimum payments are missed, or if you need to go further into debt to pay them, it’s time to get help.

Nobody likes dealing with constant harassing phone calls or late payment notices. if you can’t afford to pay off all your debts, they won’t stop until you take action.

Often, wage garnishments from a creditor just compound the problem, and make it even more difficult to pay off your other debts.

Get A Fresh Start

It’s time to take back control of your life.
Call us today at (416) 927-7200 or fill the in the form below and book your free consultation.