“The only thing that is sure in life is death and taxes”- unknown.

One thing this adage doesn’t tell you is that even after death, there are taxes.

It is very difficult trying to understand estate taxes when you are dealing with the loss of a loved one. At Hummingbird Financial we know it can be a difficult time for you, particularly if you are a surviving spouse or executor for an estate.

Common questions are:

1. Can I deduct funeral expenses, probate fees, or fees to administer the estate?
2. Who reports a death benefit that an employer pays?
3. On what return do I report Canada Pension Plan (CPP) or Quebec Pension Plan (QPP) death benefits for the estate of the deceased?
4. Who reports amounts an employer pays for vacation and unused sick leave?
5. The deceased had investments in a tax-free savings account (TFSA). Who reports any income earned in the TFSA?
6. If the deceased person was paying tax by instalments, do I have to continue making those instalment payments?
7. Why do I have to return the deceased person’s GST/HST credit?

The Canada Revenue Agency does provide guidance on what happens in these situations, but when you are grieving, this might not be the best time for you to be catching up on your tax reading. Let us help you through this challenging time.