Estate tax proposal surfaces
Social threads picked up proposed changes from the Carney review that could tax capital gains on estates—sparking discussion about accelerating intra‑family transfers or revising succession plans reported. The idea is prompting high‑net‑worth chatter about how future inheritances might be treated for capital gains purposes.
The 2024 federal budget proposed raising the capital‑gains inclusion rate from 50% to 66.67% for individuals (with a $250,000 “safe harbour”) and to 66.67% for corporations and trusts, according to the legislative backgrounders. (bakertilly.ca) Budget documents projected roughly C$19.4 billion in revenue over five years from the capital‑gains changes, while the Parliamentary Budget Officer later estimated about C$17.4 billion. (investmentexecutive.com) The Canada Revenue Agency issued administrative guidance and tax‑return form changes reflecting the proposed rules and flagged an effective date of January 1, 2026 for corporations, even though draft legislation had not been enacted. (canada.ca) Private‑practice counsel and tax commentators documented that CRA practice and early forms created filing confusion and that the CRA indicated it may apply proposed changes administratively before law was passed. (hullandhull.com) Tax analysts warned that an increased inclusion rate would disproportionately affect estates, trusts and vacation properties and could force liquidity challenges or post‑death sales to meet tax bills, an outcome explored in BloombergTax and other legal commentaries. (news.bloombergtax.com) Estate‑planning firms immediately highlighted tactical responses such as estate freezes, allocating gains to beneficiaries while alive, and using pipeline or loss‑carryback strategies for corporate shares—guidance published by boutique firms and major tax practices after Budget 2024. (allaboutestates.ca) Prime Minister Mark Carney publicly announced cancellation of the proposed capital‑gains hike on March 21, 2025, but professional bodies including Advocis and PwC continued to advise revisiting succession documents because draft legislation, CRA administration and prior guidance left unresolved operational questions. (globalnews.ca)
