Transfer Under Value

Transfer Under Value
Transfer Under Value

A Transfer Under Value occurs when an individual exchanges an asset with another party for less than its true value.
Examples include gifting a car to a child, transferring your ownership in your home to your spouse, or selling a property for much less than it is worth.
If you’re dealing with an arm’s length party, who is not related to you, then this only becomes an issue if you owed more than you owned at the time of the transfer, you intended to defeat your creditors, and you make an assignment in bankruptcy or consumer proposal.
If you are related to the person you transfer the asset to, then it’s always an issue if the transfer occurred within one year of you making an assignment in bankruptcy or consumer proposal.  The transfer can be an issue even if it occurred as many as five years ago if you were insolvent at the time of the transfer or intended to defeat creditors.  A common example of this is transferring your ownership interest in your home to your spouse, and then filing for bankruptcy a few years later.


If you’re dealing with debt, understand that you can’t shelter your assets by transferring them to friends or family.  Doing so, and then seeing a Trustee will create a more challenging situation then simply visiting a Trustee and discussing your options based on what you currently own.  The bankruptcy and insolvency system, which includes consumer proposals, is designed to be fair to everyone and is punitive towards individuals who attempt to take advantage of it.
Our consultations are always free, so if you’re dealing with debt and need to understand your options then give us a call.  We solve debt problems, and we’re here to help.