Income Taxes at Death

The deceased's estate may have to pay federal and provincial taxes, because every taxpayer is deemed to have disposed of his property at the time of death. Capital gains and recaptured depreciation are also taxable. In addition, any RRSP balance, unless transferred to the spouse, generally becomes fully taxable in the year of the death and is added to the deceased taxpayer’s income.

A final tax return must be completed, and you should also consider the advantages of a second return, known as a "separate return.”

In most cases, the legal advisor or accountant who takes care of the estate is responsible for filing the tax returns.

For further information, contact the federal or provincial income tax office in your region.

This information is presented for information purposes only and should not be considered to be legal or financial advice. For further information, contact a legal or financial advisor.