Section 11 – Deceased Persons
From a tax perspective, the main responsibilities of the legal representative are as follows:
- To file all tax returns for the deceased (including required tax elections);
- To pay all taxes for the deceased;
- To obtain a clearance certificate or authorization from the tax authorities to distribute the assets of the deceased;
- To let the beneficiaries know which of the amounts they receive from the estate are taxable based on elections made.
The legal representative is responsible for ensuring the income taxes for the deceased are paid. This may necessitate obtaining tax information that is available from the respective tax authorities. To have access to this information, the legal representative must, among other things, present a copy of the death certificate, a copy of the will or any other document indicating he/she is the legal representative of the deceased, accompanied by duly completed Authorize a Representative1 (federal) and MR-69 (Quebec).
1 Representatives can request access to the client’s online information using the online Represent a Client form or a T1 application. To authorize a representative to obtain information by telephone or mail, the new online form, AUT-01 – Authorize a Representative for Access by Phone and Mail must be sent to the CRA.
Moreover, it is recommended that government authorities and financial institutions be notified as soon as possible of the date of death if:
- The deceased was receiving OAS benefits, QPP or CPP benefits, GST/HST credits, or any advance payments for tax credits;
- The deceased was receiving the solidarity tax credit (Quebec);
- The deceased or his/her spouse was receiving the CCB or the Family Allowance or in the case of a deceased child in respect of whom these benefits were being paid;
- The deceased was receiving payments under an RRIF or an RPP.
Old Age Security Pension
The OAS pension is paid for the month during which the taxpayer died and has to be reported in one of the tax returns (see point 2 of this section) of the deceased. Any amounts received for months following the month of death have to be returned to the federal government.
Quebec Pension Plan and Canada Pension Plan
As with the OAS pension, the right to receive an QPP or CPP annuity ceases as of the month following the death. Any beneficiary eligible for one or more death or survivor benefits paid out by the QPP and CPP upon the death of the plan’s subscriber or main beneficiary (see Section XII) must submit the appropriate related request to the government authorities in question.
Goods and Services Tax Credit
The GST/HST credit is paid in July, October, January and April. If a single individual dies in a month before the credit payment is sent, the cheque must be returned. The estate is entitled to it if the individual dies during one of these months.
The surviving spouse may be eligible for the GST/HST credit. The spouse should contact the CRA and request any remaining credit for the year and file a tax return for the preceding year if this has not already been done.
Solidarity Tax Credit
Solidarity Tax Credit payments cease in the month following the death of the beneficiary. Since July 1, 2020, it is no longer necessary for the surviving spouse to file a new application with the ARQ to receive the solidarity tax credit. the ARQ automatically continues to make the payments to the surviving spouse.
Canada Child Benefit and Family Allowance
A surviving spouse who is the father or mother of a child in respect of whom the deceased was receiving the CCB, or the Family Allowance should contact the government authorities in order to have the benefits transferred to him/her. If, on the other hand, the surviving spouse was the recipient of these benefits, he/she can ask the government authorities to recalculate the benefits taking only his/her income into consideration.
If the person now responsible for the care of the child is someone other than the father or mother, this person has to submit a written request to the government authorities to be eligible to receive these payments.
If the deceased was an eligible child, the CCB entitlements cease the month following the death. The Family Allowance ceases the first day of the quarter following the death of the child. Any amounts received after these dates have to be returned.
No instalments have to be paid for a deceased for the period following the date of death. Nevertheless, the legal representative should ensure that any amounts due prior to the date of death were in fact paid.
This document is up to date as of September 3, 2020 and reflects the status of legislation, including proposed amendments at this date.