Pocket-Friendly Estate Clearance Certificate for Trusts and Estates in Canada

Sign in to CRA My Account, or use the CRA's mobile app, where the return shows as received, in process or assessed, and the refund amount and payment date appear once it has been assessed. The CRA also runs an automated telephone service giving the same information. A representative you have authorised through Represent a Client can check it for you. If the status has not moved past the published processing time, the return is probably under review.

Canada taxes income in graduated brackets, so only the income above a threshold is taxed at that bracket's higher rate and moving up a bracket never reprices the income below it. There is one federal set of brackets and a separate set for each province and territory, and the thresholds are indexed to inflation every year. Look up the current figures for your province on the CRA rate tables rather than relying on an older list.

Tax legislation is the written law that imposes and administers tax: federally the Income Tax Act and the Excise Tax Act, plus each province's own statutes and the municipal bylaws behind property tax. A change usually begins as a budget announcement, is drafted into a bill, passes Parliament and takes effect on royal assent. Regulations and CRA guidance sit beneath the statutes and explain administration without replacing them. Some proposals are administered before they pass, and a few never do.

There is no general tax exemption card. A certificate of Indian status held by a person registered under the Indian Act supports GST/HST relief on qualifying purchases and Ontario point-of-sale relief. Foreign diplomats and certain international organisations carry their own federal relief documents. Charities and non-profits register with the CRA rather than hold a card, and businesses buying for resale use registration numbers and exemption certificates. The vendor decides on the document shown, so verify the rules first.

A trust files its own T3 return and pays tax on income it retains, generally at the top personal rate for most inter vivos trusts. Income paid or made payable to a beneficiary is instead deducted by the trust and taxed in the beneficiary's hands, keeping the character of the income, such as dividends or capital gains. Graduated-rate estates and qualified disability trusts use graduated rates. No calculator captures this; the allocation decisions drive the result.

Canada levies no estate tax and no inheritance tax. What happens at death is a deemed disposition: most capital property is treated as sold at fair market value and the resulting gains are taxed on the final return, while registered plans are generally brought into income unless they pass to a spouse or a qualifying dependant. Planning targets those two exposures through spousal rollovers, insurance to fund the tax, and trusts. Provincial probate fees are separate.

Canada has no joint return, so your husband cannot claim you as a dependant the way US filers do. He can claim the spouse or common-law partner amount if your net income is low enough, and unused credits such as the age, disability, tuition and pension amounts can sometimes be transferred to him. Medical expenses and donations can also be pooled on one return. Both of you still file your own T1, reporting each other's net income.

Usually yes. A rental loss from a genuine income-earning property reduces your other income for the year, such as employment income, and any unused amount becomes a non-capital loss you can carry back or forward. The CRA will challenge losses where there is no reasonable expectation of profit, where rent is below market to a relative, or where personal-use expenses are claimed. Capital cost allowance cannot create or increase a rental loss.

An employer does not pay the employee income tax, it withholds and remits it. What the employer bears on top of wages is its matching share of Canada Pension Plan or Quebec Pension Plan contributions and its share of Employment Insurance, which is a set multiple of the employee premium. Provincial employer levies can apply as well, such as the Ontario employer health tax or the Quebec health services fund. Everything withheld and matched goes in with the payroll remittance.

Canada has no identifier called a tax verification number. Individuals are identified by a social insurance number, or an individual tax number where a SIN is not available. Businesses use a CRA business number, with program accounts added for GST/HST, payroll and corporate tax. If you need to confirm that a supplier's GST/HST registration is real before claiming the tax they charged, use the CRA's GST/HST registry search, which validates a number on a given date.

Life insurance premiums are not deductible, whether paid personally or by a corporation, because the policy is not a cost of earning income. One narrow exception applies where a lender requires a policy as collateral for a loan used in the business, which allows a deduction for part of the premium. With corporate-owned policies the planning value sits in how the proceeds are paid out to shareholders, not in the premium.

Scholarships, fellowships and bursaries are reported on your return, but the scholarship exemption often removes them from tax entirely. A full-time student in a qualifying educational programme can usually claim the exemption for awards connected to that programme, leaving nothing taxable. Part-time students get a narrower exemption, and post-doctoral fellowship income is treated as income. An award that is really payment for services counts as employment income and the exemption does not apply.