Tax returns for deceased persons
DECEASED PERSONS’ DECLARATION IN CANADA: WHAT TO DO WHEN A LOVED ONE HAS PASSED AWAY
How to submit a deceased person's tax return
When a person has died, his personal representative of the succession (liquidator or administrator of the succession) must submit a final declaration. The word “succession” refers to everything a person owns when he or she dies, including his debts and assets. The personal representative also notifies the CRA, Revenu Québec (if necessary) and Service Canada of the date of death and sends the appropriate documents.
When is the final return and payment of tax to be made?
If the death occurred between January 1 and October 31, you have until April 30 of the following year. If it was between November 1 and December 31, the due date is six months after the date of death.
Why is this important?
When someone passed away, in addition to regular income tax, their succession may also be liable to tax on property. The final return will indicate whether the deceased owes income tax. Like all other debts, the income tax must first be paid by the succession before the heirs can receive their inheritance. This is called settling the succession. The notice of assessment of a deceased person's tax return is one of the documents that the personal representative of the succession needs in order to obtain a clearance certificate and distribute the succession's property.
What is the difference between a beneficiary and an heir?
A beneficiary is a person, institution, estate or trustee designated by the deceased in a contract to receive advantages under a will, insurance policy, pension scheme, annuity, trust or another type of contract.
For example, the spouse may be the beneficiary of the pension plan that the deceased had with his employer and the nephew of the deceased may receive the amount insured under the life insurance policy. The others are merely heirs and can be mentioned in the will. They may be affected by succession tax laws in Canada.
What do I do with cheques received after death?
You may have to return some cheques but you will have to stop all payments, like Child Tax Benefit, Child Care Tax Credit, GST/HST/QST Credit, Northern Village Credit and other cheques. Vacation pay constitutes a revenue for the deceased and unused sick leaves are considered as a source of income for the succession or beneficiary. If the deceased had a TFSA account, no need to declare anything, but depending on the type of beneficiary, it may no longer be a TFSA after death.
What information do I need for the final return?
You must know all the sources of income of the deceased person and their respective amounts from January 1 of the year of death to and including the date of death. You will probably need to review the previous declarations and contact former employers, banks, trust companies, brokerage firms and pension plan administrators. You will have to collect statements, information sheets and any other documentation required to indicate or estimate income and deductions. The final return cannot be sent by IMPÔTNET.
What if I need information from the CRA or Revenu Québec?
You will need to provide a copy of the death certificate, the deceased's social insurance number and a copy of the document proving you are the personal representative of the succession or liquidator.
You can also use different income tax returns to declare some income categories. Moreover, by deducting certain amounts more than once, or by distributing them over several returns, you may reduce or waive the deceased's tax liability.
For more information, see the CRA Guide T4011, Preparing Returns for Deceased Persons, available here.
AT YOUR SERVICE FOR PREPARING TAX RETURNS
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We will provide guidance in preparing the deceased's tax returns and accompany you through all stages of the procedure. Do not hesitate to seek our help as we make sure that all tax procedures are carried out under the best conditions.
We help you to carry out all immediate procedures after death
A MANDATORY FORMALITY
Upon the death of a person liable to tax, his or her spouse and heirs are under legal obligation to settle all necessary formalities. The death must be reported to the public finance centre.
With over 25 years of experience in the field, we can process your requests promptly and help you settle the deceased's tax situation as quickly as possible. We can also deliver a tax return.
We are here to quickly settle the deceased's tax situation
Contact us for more information.