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Expected to Work/Barriers to Full Employment Policy & Procedures |
Published Date: July 10, 2007
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14 Overpayment, Debt and Recovery |
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Write Off and Suspension of Debts
When all efforts at collection on closed files are ineffective, the debt is considered not collectible and may be approved for write-off. The Deputy Minister or designate may approve the write-off of all or part of the amount owing. This authority has been delegated to:
- The Director of Financial Operations for individual debts of $5,000 or less.
- Executive Director of Finance for individual debts exceeding $5,000.
The identification of debts for permanent write-off is the responsibility of Financial Operations.
Debt write-offs are divided into two classes – permanent write-offs and suspensions.
Permanent Write-Offs
The following are the criteria for a permanent write-off:
- Balance is $500 or less with no payment activity for more than one year.
- Balance is greater than $500 with no payment activity for more than two years.
- Ministerial request to cease collection activity on compassionate grounds.
- Repayment of debt would cause the debtor undue hardship.
When approval is given for a permanent write-off the Collections Unit removes the debt from the Recoveries System. The debt is no longer part of the client’s outstanding debt.
Suspensions
Debts are considered for suspension on when:
- The debt does not meet any of the criteria for permanent write-off.
- Collection is deferred due to temporary financial hardship.
A person whose debt is suspended is not advised their debt is cancelled as the debt remains as part of the debtor’s outstanding balance and may be collected in the future. A suspended debt is not actively pursued for collection; however, they are subject to collection if the client’s file is reopened (auto-deduction) or their financial circumstances change.
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