IC98-1R4 "Tax Collections Policies" 12 June 2013

We can offset (apply against another debt) your repayment or refund to debts for which you are liable. However, for debts that relate to the Income Tax Act, we will not usually offset a refund against an outstanding amount, other than a deemed trust debt, if the amount owing is the subject of an objection or appeal on which neither the CRA's Appeals Division nor the court has made a decision.

We will accept adequate security instead of payment under some circumstances. For example, if the Tax Court of Canada or the Canadian International Trade Tribunal dismisses your appeal and you exercise your right to appeal to a higher court, we will ask you to immediately pay the full amount owing regardless of your further rights to appeal. However, we will accept adequate security instead of payment, such as a bank letter of guarantee, a bank letter of credit, or mortgages.