How to File Taxes for a Deceased Person in Ottawa

A lot of people from Ottawa email or call me every year, unsure what to do when someone in the family passes away. It’s one of the most sensitive cases, and it’s one of the hardest to deal with when emotions are already running high.

Filing a tax return for someone who passed away isn’t just paperwork. It’s part of the legal process of settling the estate. If you're the executor, or even just trying to help out, here’s what you need to know.

1. What Tax Return Are You Filing

The return is called a “T1 - Final Return.” It covers income from January 1 up to the date of death. You’ll include anything they earned or received before they passed away:

• Employment income
• CPP, OAS, pensions
• RRSPs if they weren’t rolled over
• Investment income
• Rental or business income, if applicable

The SIN is still used, and you'll need to submit slips just like any other return. If the person passed in 2025, you're filing a 2025 return, even if it's being done in 2026.

2. What Paperwork Do You Need

• Death certificate
• A copy of the will or a court appointment naming the legal representative
• All T-slips (T4, T5, T4A etc.)
• Details on any RRSPs, RRIFs, or investments
• Access to their CRA account if possible

If you’re not already listed with CRA as the authorized rep, you’ll need to submit Form RC552 to get that access.

3. Filing Deadlines

The filing deadline depends on when the person passed:

• If they passed between January 1 and October 31, the return is due April 30 of the following year
• If they passed between November 1 and December 31, it’s due six months after the date of death

Example: someone who passed away on November 12, 2024, would have a due date of May 12, 2025.

4. Taxes and Capital Gains

When someone passes, the CRA assumes they sold everything at fair market value on that day. That’s called a “deemed disposition.” It could affect:

• Real estate
• Stocks and securities
• Personal-use property over a certain value

It could not apply to RRSPs or RRIFs if they’re being transferred to a spouse. But if they’re not, they’re fully taxable in the final return.

5. Optional Returns

Depending on the assets and income types, you might want to file one or more optional returns:

• Return for Rights or Things
• Return for Business or Partnership Income
• Return for Income from a Trust

These let you separate out different income types and use more personal tax credits. They’re optional but can reduce taxes significantly.

6. Ask for a Clearance Certificate

Before the estate pays out any inheritance, you could also request a Clearance Certificate from the CRA. This protects the executor or family members from being held liable for unpaid taxes.

You’ll need to file Form TX19, include a copy of the will, proof of death, and show that all taxes have been filed and paid.

7. Common Mistakes I See in Ottawa

• RRSPs not reported properly
• CPP death benefit or survivor benefit not included
• Not getting the clearance certificate before distributing assets
• Assuming CRA will know someone passed without proper notification
• Not reporting deemed disposition on shares or real estate
• Missing the chance to claim optional returns

Final Thoughts

I’ve helped clients in Ottawa deal with this, whether it’s a small estate in Kanata or a complex situation in Orleans. You don’t need to be an expert in taxes. You just need a clear path forward.

If you need help filing the final return, dealing with RRSP rollover issues, or figuring out capital gains, feel free to reach out. This process is hard enough already without also having to deal with CRA rules alone.

Quick Recap Checklist

• Confirm the date of death
• Collect slips and investment details
• Appoint a legal representative
• File the T1 return by the right deadline
• Include deemed dispositions
• Consider optional returns
• Ask CRA for a clearance certificate
• Keep all documentation

References

• CRA guide on preparing returns after death
• Reddit – r/PersonalFinanceCanada
• Reddit – r/cantax

This blog is for educational purposes only. For help with your specific situation, contact a tax professional in Ottawa.
Email: hello@taxesmadesimple.ca
Text or WhatsApp: 613.600.4194