December 2, 2021
My spouse died intestate in December 2022. We have a number of non-registered GICs with 1yr terms which were purchased in 2022 before she died. My spouse and myself are joint owners, with right of survivorship. She contributed 80% to the GICs while my contribution was 20%. I am the sole beneficiary of her estate.
If the GICs are placed in my name alone, will I have to declare 100% of the 1yr earned interest on my 2023 tax return, or should the portion of her 80% interest that was earned in 2022 before her death be declared on her 2022 final income tax return, even though the principal and interest will not be paid out until the maturity dates in 2023?
October 27, 2013
In the case of an individual, one would have the FI do an accrued interest calculation to date of death so that interest earned to date of death would be on the Final T1 tax return and the remaining on T3 testamentary returns.
If that logic also holds for joint GICs, then do the same thing. Have the FI provide you with accrued interest up to date of death and apply 80% of it to spouse's Final T1 return and the remaining 20% plus 100% of the residual post-death would be assigned to you. That is the way I would file it in the absence of any other facts to the contrary.
The FI won't likely do the tax slip right, so you will likely need to attach a calculation sheet showing the portion of the T5 that goes to the Final T1 return and the remainder to you.
April 6, 2013
Estate and will don't matter with joint accounts and joint GIC's.
Contact the GIC issuer. Spouse's name can be removed right away with death certificate and your consent to the removal. No need to wait for probate.
As AltaRed described, 80% of the interest accrued to date of death is on the spouse's final return for 2022. Rest will be on your return for 2023, the tax year the GIC will mature.