If a loved one has passed away, the Canada Revenue Agency (CRA) requires that the legal representative—the executor named in the will, or the court-appointed administrator of the estate—file a final tax return for them. The legal representative's responsibilities under the Income Tax Act include: filing all necessary returns for the deceased; ensuring any taxes owed are paid; informing the beneficiaries if anything they receive from the estate is taxable; and, if necessary, getting a clearance certificate to prove that the CRA has been paid any amounts owed.
Gather all necessary documents so you can access the deceased's tax records. You will need a copy of the death certificate, the deceased's social insurance number and a complete copy of the will or other relevant legal document.
Contact the CRA as soon as possible to inform them of the deceased's date of death, either by phone at 1-800-959-8281 or by mailing in the form--Request for the Canada Revenue Agency to Update Records--included with Information Sheet RC4111: What to Do Following a Death.
Arrange for all payments to be stopped. This includes any payments the deceased may have been receiving--such as GST/HST (goods and services tax/harmonized sales tax) credits--or paying, such as tax installments. The CRA will be able to assist you in determining if any payments should be transferred to a family member.
Gather all documents you need to file the return. This includes: documentation of all income the deceased received; the tax package from the province or territory where the deceased resided at the time of death; and any other relevant documents, such as statements of investments, charitable or political donations and medical costs.
Determine whether you intend to file a single tax return or to also file one or more optional returns. The three optional returns are not required but by using them, the deceased may end up owing less tax, which means more money for the estate. If you are unsure which returns to file, contact the CRA or a tax professional for guidance.
Prepare the tax return and any optional returns, following the CRA's guide, T4011: Preparing Returns for Deceased Persons.
Submit the return(s) to the CRA.
Tips
The final tax return is normally due by April 30 of the year following death, except when the date of death is in November or December, in which case the tax return is due within six months of the date of death. Other due dates may apply if the deceased or the deceased's spouse or common-law partner was operating a business during the year in which the death occurred. As the legal representative, you have the option of delegating these responsibilities to another qualified individual. Do this by submitting Form T1013: Authorizing or Canceling a Representative.
Warnings
You may also have to file tax returns for previous years, if the deceased did not file them. Contact the CRA if you are unsure whether these returns have been filed. If you file the return late and there is a balance owed, the estate may have to pay a penalty. Avoid this penalty by submitting the return on time, even if you can't pay the balance owed at that time.
References
Tips
- The final tax return is normally due by April 30 of the year following death, except when the date of death is in November or December, in which case the tax return is due within six months of the date of death. Other due dates may apply if the deceased or the deceased's spouse or common-law partner was operating a business during the year in which the death occurred.
- As the legal representative, you have the option of delegating these responsibilities to another qualified individual. Do this by submitting Form T1013: Authorizing or Canceling a Representative.
Warnings
- You may also have to file tax returns for previous years, if the deceased did not file them. Contact the CRA if you are unsure whether these returns have been filed.
- If you file the return late and there is a balance owed, the estate may have to pay a penalty. Avoid this penalty by submitting the return on time, even if you can't pay the balance owed at that time.
Writer Bio
Kate Clark is a Toronto-based freelance writer who has been writing professionally since 2001. Her work has appeared in publications such as "Canadian Living," "Elle" and "Homemakers." She specializes in writing about health, fitness, nutrition and food. Clark holds a literature degree from the University of Toronto.