Path to Secure Estate Asset Transfers with a Clearance Certificate
Settles estate tax liabilities before asset distribution.
Verifies CRA's review of the deceased's tax affairs and outstanding obligations
Offers legal protection to executors from personal liability for estate taxes
Frequently needed by institutions and asset holders to prevent tax issues during asset transfer to beneficiaries
Do not apply for a clearance certificate at the same time as you file the tax returns as it will delay the process. The legal representative should apply for a clearance certificate after all of the necessary returns have been filed and assessed and all taxes have been paid.
To apply for a Clearance Certificate, you need to complete and submit Form TX19, “Asking for a Clearance Certificate,” to the CRA. You must include all required supporting documents.
The supporting documents include:
The processing time can vary and depends on the complexity of the estate and the completeness of the application. It can take up to 120 days to receive a clearance certificate.
CRA does not charge a fee for issuing a clearance certificate
Failing to obtain a clearance certificate before they distribute assets will result in the personal liability of the estate’s executor or trustee for any unpaid taxes, interest, or penalties. It may also prevent the distribution of assets to beneficiaries because the lawyer or financial institution often wants to see the clearance certificate.
Outstanding tax debts or disputes with the CRA will delay the issuance of a clearance certificate. It’s important to work with the CRA to resolve these issues before proceeding with the clearance certificate application.
The legal representative should apply for another clearance certificate before distributing the newly discovered property. They should contact the regional tax services office where they originally filed the clearance certificate application.
