How Do You Get a CRA Clearance Certificate for an Estate in Ontario?
You request a clearance certificate on Form TX19, Asking for a Clearance Certificate, but only after the returns are filed and the notices of assessment have been received. For a trustee, that means the request comes near the end of the process, just before the estate is distributed to the beneficiaries.
The timing matters because a legal representative must obtain a clearance certificate under subsection 159(2) of the Income Tax Act before distributing property they control. Distributing without one can make the representative personally liable for unpaid amounts, though not for more than the value of the property distributed.
The CRA says the assessment can take up to 120 days if all documents are provided. Processing times are targets and change over time, so allow extra room before you plan any payments to beneficiaries. The returns come first: the legal representative must file a final T1 return, and a T3 return may also be needed for the estate. The final T1 is generally due April 30 of the year after a death from January 1 to October 31, with a different date for deaths in November or December. A lawyer or accountant can confirm which returns your estate needs.
Key takeaways
- Request the certificate on Form TX19 only after the returns are filed and the notices of assessment have been received.
- A legal representative who distributes without a clearance certificate can be personally liable for unpaid amounts, up to the value of the property distributed.
- The CRA says the assessment can take up to 120 days if all documents are provided, so plan for the wait before paying beneficiaries.
- The final T1 return, and possibly a T3 return for the estate, must be filed first, and the due dates depend on the date of death and whether there was business income.