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Tax Tips After Death
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Tax season has begun. Everyone should be receiving their T4 Forms by the end of February, and should be filing their taxes by April 30th.
However, there are many tax implications that happen after death. Below are the top five points to remember when dealing with someone’s tax returns after they have passed away:
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The Estate Trustee is responsible for filing a final tax return on behalf of the deceased. The Estate Trustee must report all of the deceased income from January 1 of the year of death, up to and including the date of death.
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The due date for the final return is determined as follows:
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If the death occurred between January 1 and October 31, the due date for the final return is April 30 of the following year;
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If the death occurred between November 1 and December 31, then the due date for the final return is 6 months after the date of death.
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If the death occurred between January 1 and October 31, the due date for the final return is April 30 of the following year;
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If the deceased received a GST/HST credit payment after the date of death because the Canada Revenue Agency (CRA) was not aware of the death, then the Estate Trustee should return this credit payment to the tax center that serves their area. The Estate Trustee is responsible for providing CRA with the date of death so that CRA can update their records.
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If the deceased received a Canada Child Tax Benefit or a Universal Child Care Benefit after death then the Estate Trustee should inform CRA in writing of the date or death. CRA will determine if some other family member may be eligible to get the benefits for the child.
- Always get a Tax Clearance Certificate before distributing any property to the beneficiaries. The Tax Clearance Certificate certifies that all the amounts the deceased owed to CRA have been paid or that CRA have accepted security for the payment.