Are you thinking about sponsoring a family member in Canada? This process is the path to family reunification, a wonderful opportunity to bring your loved ones to you. To do so, you must sign an Undertaking or Sponsorship Commitment, a legally binding contract that establishes long-term financial responsibility to the government.

If this commitment is not fulfilled, it falls into a "Defaulted" , which is the most serious risk of this agreement, as it entails a permanent ban on future sponsorships until the debt is paid off. 

To avoid this unfortunate situation, it is important to know what actions can lead to a breach of sponsorship payment and what the consequences are. Here I will present them in a simple way. 

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How does one become "Defaulted" due to sponsorship?

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To be "Defaulted" means that the sponsor has failed to meet the financial obligations of the Undertaking, which aims to protect the social welfare system from expenses incurred by the sponsored person.

The risk of default is triggered if the sponsored person (spouse, partner, or family member) applies for and receives public assistance from the provincial or territorial government during the term of the undertaking. 

The government considers these payments to be a direct debt of the sponsor.

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The formal default process

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Actions that cause the sponsored party to default:

1. Application for social assistance: the sponsored person receives financial assistance from the province.
2. Debt registration: The province notifies the federal government (IRCC) and transfers the amount of assistance paid to the sponsored person as a legal debt of the sponsor.
3. Defaulted status : the sponsor is formally registered as being in default.

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What the government is doing to recover the debt

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The government uses collection methods to recover the funds paid:

1. Formal notice: the sponsor receives a detailed notice of the outstanding debt.
2. Benefit deduction: The government has the authority to automatically withhold the debt from the sponsor's future federal benefits, such as income tax refunds, tax credits, or child benefits (Canada Child Benefit).

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Consequences of not paying the debt

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A sponsor in default is permanently disqualified from filing new sponsorship applications (for other family members) until:

• The entire debt has been paid off and verified by the competent authorities.
• This prohibition is indefinite and remains in force even if the original Undertaking period has ended, as long as the debt persists. 
• It is an immigration restriction that affects future family reunification.

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Are you in debt or do you need to clarify your status? 

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A lack of financial organization at home can lead to a default on family sponsorship in Canada. If you are at risk of defaulting on your payment commitment due to a lack of resources or because you did not foresee the consequences, do not hesitate to seek advice from a Canadian immigration specialist.

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Immigration consultation with Immiland Law Professional Corporation

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At Immiland Law Professional Corporation, we are here to guide you through your immigration situation in Canada. We invite you to request a specialized consultation with our lawyers and CICC-regulated consultants for:

• Assess your current status and determine whether you are listed as defaulted.
• Clarify the exact amount of the debt.
• Design an action plan to settle the obligation and regain your eligibility for future sponsorships.

If you would like more information, please contact us and we will be happy to help you.

I hope you find this topic useful. Thank you for reading. See you in the next blog!

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With love,

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Immiland Law Professional Corporation