I'm often asked how a person goes about getting a tax clearance certificate. The certificate does not come out automatically; it has to be requested in the right way at the right time. The vast majority of executors that I've worked with have asked the accountant who does the tax returns for the estate to request the clearance certificate. This is because accoutants who are familiar with taxation know how and when to get it.
However, if you want to request one yourself, here are the basic steps:
- file all of the necessary tax returns for the deceased and the estate;
- receive the Notice of Assessment for the returns you've filed;
- fill in a form called TX19, that you can find online here;
- send the form to your local tax office, along with a copy of the Will, a copy of all probate documents and a statement of proposed distribution.
It takes a long time to get the tax clearance certificate. You should expect to wait several months in most cases. Because of the long wait and the unwillingness of beneficiaries to wait longer than necessary for their inheritance, there is a process in place for making an interim distribution of the bulk of the estate while keeping back enough money to pay the taxes and future expenses. I'll post about that interim process in a separate post.
To go to the Canada Revenue Agency page on clearance certificates, click here.