Investment income

Report income earned before the date of death on the Final Return

There are 3 types of income you might need to report from investments:

Dividends from taxable Canadian corporations

Found on slip and forms

T5, T4PS, T3 (slip), T5013

Report on lines

12000 and 12010 (120 and 180 before tax year 2019) of the deceased's Final Return

Refer to Lines 12000 and 12010 – Taxable amount of dividends from taxable Canadian corporations.

Interest and other investment income

Found on slip and forms

T5, T3 (slip), T5013

Report on line

12100 (121 before tax year 2019) of the deceased's Final Return

Enter all interest and other investment income the deceased received from January 1 to the date of death on line 12100.

Also include the following interest and other investment income the deceased had earned but not yet received up to the date of death:

• Interest earned from bank accounts, term deposits, guaranteed investment certificates (GICs), and other similar investments from the last time these amounts were paid to the date of death, less any amounts reported in previous years
• Interest on regular interest bonds earned from the last time it was paid to the date of death
• Interest on compound interest bonds that accumulated to the date of death, less any amounts reported in previous years

Refer to Line 12100 – Interest and other investment income.

Capital gains on investments are reported on a different line

Refer to Taxable capital gains on property, investments and belongings.

Report income on an optional Return for Rights or Things

The optional Return for Rights or Things can only include amounts earned before the date of death but paid after the date of death, for amounts such as:

• uncashed matured bond coupons
• bond interest earned but not received before death
• dividends declared before the date of death, but not received before death

Report income on a T3 Trust Income Tax and Information Return (T3 Return)

Amounts earned by the estate after the date of death will need to be reported on the following lines of the T3 Return:

Line 1

Enter the total taxable capital gains from line 24 of Schedule 1, Dispositions of Capital Property, which includes capital gains on investments, mutual funds, shares, bonds, debentures, promissory notes, crypto-assets, and other similar properties.

Line 3

Enter the total of the actual amount of dividends received from taxable Canadian corporations from line 3 of Schedule 8. On line 3A, enter the actual amount of dividends other than eligible dividends from line 1 of Schedule 8. Attach all information slips received.

Line 4

Enter all interest and other investment income from foreign sources from line 6 of Schedule 8. Attach all information slips received.

Line 5

Enter the amount from line 12 of Schedule 8. Include all interest and investment income from Canadian sources except dividends from taxable Canadian corporations reported on line 3. Attach all information slips received.

When to include gains from a TFSA

A TFSA generally loses its tax-free status after the account holder dies. Increases in the value of the TFSA account after the date of death might need to be included in a T3 Return. Refer to Death of a TFSA holder for details.