Six Recent Tax and Estate Developments Canadians Should Know About
Tax rules do not operate in isolation. Recent developments involving digital assets, taxpayer privacy, trust reporting, dispute deadlines, GST/HST credits and employment expenses demonstrate how tax compliance increasingly intersects with technology, estate planning and administrative law.
This month, we look at six developments that may have practical implications for individuals, business owners, trustees and executors.
Digital Assets: What Happens to Your Online Accounts When You Die?
Estate planning increasingly involves more than bank accounts, investments and real estate. Email accounts, cloud storage, photographs, cryptocurrency, social media accounts and other digital property may also need to be identified and dealt with after death.
A recent Alberta decision illustrates a problem executors and estate administrators can encounter when technology companies control access to those assets.
In Wada Estate (Re), 2026 ABKB 309, administrators of an estate had obtained a Grant of Administration that expressly authorized them to access and deal with the deceased’s digital assets. Nevertheless, Apple Canada required them to obtain an additional court order before it would provide access to the deceased’s Apple accounts. [dentonsdata.com], [canadianla…yermag.com]
The Alberta Court of King’s Bench concluded that a further order was unnecessary. The existing Grant of Administration was itself a court order establishing the administrators’ authority over the estate, including the deceased’s digital assets. The Court was critical of requiring estates to incur the time and expense associated with obtaining duplicative orders. [step.ca], [alri.ualberta.ca]
Why this matters for estate planning
The case highlights a relatively new but increasingly important estate-planning question: Will your executor actually be able to access your digital property after you die?
Some platforms provide tools that can simplify the process. Apple, for example, offers a Legacy Contact feature allowing an individual to designate someone who can seek access to information in the person’s Apple Account following death. The deceased in Wada Estate had not used that feature. [hullandhull.com], [canadianla…yermag.com]
Digital estate planning should therefore form part of the broader estate-planning conversation. Individuals should consider identifying important digital assets, maintaining appropriate records of those assets and reviewing what succession or legacy-access options are offered by the relevant platforms.
The takeaway: A properly appointed executor or administrator may have legal authority over digital assets, but practical access can still become complicated. Planning for digital property during your lifetime may save your estate significant time and expense later.
Taxpayer Information and Privacy: CRA Security Under Scrutiny
Canadian taxpayers provide the Canada Revenue Agency with some of their most sensitive information, including Social Insurance Numbers, addresses, banking information, income information and details about their families and businesses.
A May 2026 report from the Office of the Privacy Commissioner of Canada raised significant concerns about the protection of that information.
The investigation found that the CRA had reported 42,755 confirmed individual breaches involving unauthorized use of taxpayer information across six quarterly reports. The Privacy Commissioner concluded that shortcomings remained in CRA’s prevention, monitoring and detection, remediation and governance of such incidents. [priv.gc.ca], [priv.gc.ca]
The Commissioner made nine recommendations. CRA accepted eight in full and one in part. Among other things, recommendations addressed stronger authentication, monitoring the effectiveness of security controls and enhancing CRA’s ability to understand and respond to breaches. [priv.gc.ca], [priv.gc.ca]
What about accountants and EFILE?
The report is particularly relevant to tax preparers.
The Privacy Commissioner’s investigation examined EFILE as one potential entry point into the tax system. EFILE is the CRA system used by approved tax preparers to submit clients’ returns electronically. Tax preparers must apply to the CRA, undergo suitability screening and renew their EFILE access annually. [priv.gc.ca]
The investigation noted that all returns submitted by the same preparer are associated with the same EFILE number, which underscores the sensitivity of tax preparer credentials and the importance of security surrounding professional tax-preparation systems. [priv.gc.ca]
For taxpayers, there is a broader lesson here as well. The Privacy Commissioner’s report notes that compromised taxpayer information can be used to redirect government benefits and refunds and can expose victims to identity theft and significant financial hardship. [priv.gc.ca], [priv.gc.ca]
The takeaway: Protecting tax information is a shared responsibility. Taxpayers should safeguard their CRA credentials and personal tax documents, while accounting firms and tax preparers need strong controls governing EFILE, Represent a Client and access to confidential client data.
Trust Reporting: Could an Earlier Filing Lead to Schedule 15 Penalties?
Canada’s enhanced trust reporting rules have created significant new compliance obligations and, not surprisingly, considerable confusion.
Under the enhanced rules, many trusts that previously were not required to file an annual T3 return may now have reporting obligations, including providing beneficial ownership information through Schedule 15, Beneficial Ownership Information of a Trust. CRA confirms that the enhanced rules initially applied to taxation years ending on or after December 31, 2023 and have subsequently been amended for later taxation years. [canada.ca]
There have also been significant changes concerning bare trusts. CRA currently states that bare trusts are not required to file a T3 return and Schedule 15 for taxation years ending in 2024 or 2025, while certain bare trusts become subject to the reporting requirements for taxation years ending on or after December 31, 2026. [canada.ca]
An unexpected compliance problem
Another issue can arise where a trust files before all of its required Schedule 15 information has been provided.
The fact that a trust’s T3 return was submitted does not necessarily mean all of its enhanced reporting obligations were satisfied. Trustees need to determine whether Schedule 15 was required for the particular taxation year and whether all required beneficial ownership information was properly reported.
That matters because penalties can potentially apply to failures involving required trust reporting.
Taxpayers should also remember that a T3 return is generally due 90 days after the trust’s tax year-end. For most trusts, the tax year-end is December 31, although special rules apply to certain estates and other situations. [canada.ca]
The takeaway: Do not assume that filing a T3 return on time automatically means the trust has satisfied every reporting obligation. Trustees should confirm whether Schedule 15 is required and whether the information supplied is complete, particularly given the changes to the trust reporting regime over the past several years.
Judicial Review: Missing a Deadline Can Close the Door
Receiving an unfavourable CRA decision does not necessarily mean you have reached the end of the road. Depending on the type of decision, objection, appeal or judicial review procedures may be available.
But deadlines matter.
The Federal Court’s 2026 decision in Lev v. Canada (National Revenue), 2026 FC 902 provides a difficult example.
The taxpayer had been denied eligibility for the Canada Recovery Caregiving Benefit and Canada Recovery Sickness Benefit. Following a CRA decision dated March 5, 2026, she contacted the CRA to discuss her options and was advised about judicial review. Instead of immediately commencing a court application, she pursued assistance through her Member of Parliament’s office in an effort to resolve the matter without court involvement. [caselawwire.com]
By the time that approach proved unsuccessful, the 30-day statutory period for commencing judicial review under subsection 18.1(2) of the Federal Courts Act had passed. She subsequently sought an extension of time. [caselawwire.com]
The Federal Court refused the extension. Among the issues considered was whether she had demonstrated a continuing intention to pursue judicial review during the relevant period. Her decision to pursue another avenue instead of taking steps toward judicial review worked against her request. [caselawwire.com]
The practical lesson
Trying to resolve a disagreement informally does not necessarily stop a statutory deadline from running.
The same general concern applies throughout the tax system. Different CRA decisions are governed by different objection, appeal and review procedures, each of which may have its own deadline and extension provisions.
The takeaway: If you receive an unfavourable CRA decision, contact your tax advisor promptly. Determine both what remedy is available and the precise deadline for using it before pursuing informal alternatives. Once certain deadlines and available extensions have expired, a taxpayer may permanently lose a dispute-resolution option.
Overlooked Input Tax Credits: Amend the Old GST/HST Return or Claim Them Now?
Here’s a situation many businesses will recognize.
You file a GST/HST return and later discover invoices containing input tax credits (ITCs) that were inadvertently left out.
Should you amend the old return and add the ITCs there, or simply claim them on your next GST/HST return?
CRA updated its administrative policy on exactly this issue in June 2026.
The CRA’s general position is that it will normally deny a request to amend a previously filed return if the only change is an increase in ITCs or certain other deductions and there are no extenuating circumstances, because the registrant can generally claim the omitted amount on a subsequent unfiled return, provided all of the statutory conditions and time limits are satisfied. [canada.ca], [canada.ca]
In practical terms, if a business simply forgot to include an otherwise eligible ITC and there are no special circumstances, CRA instructs the registrant to include the omitted amount on its next return due to be filed. [canada.ca]
Watch the ITC deadline
That doesn’t mean an overlooked ITC can be claimed indefinitely.
CRA states that a registrant generally must claim an ITC by the due date of the return for the last reporting period ending within four years after the end of the reporting period in which the ITC could first have been claimed. A shorter two-year limitation generally applies to certain “specified persons,” including certain larger businesses and listed financial institutions. [canada.ca]
There can also be exceptions. CRA says it may exercise administrative flexibility where extenuating circumstances exist, including situations where delaying a refund could cause financial hardship or significant negative consequences, or where an amount can only be claimed in a particular reporting period. [canada.ca]
The takeaway: Finding an old invoice does not necessarily mean you have to reopen an earlier GST/HST return. In many ordinary situations, an eligible overlooked ITC can be claimed on the next return, but the applicable limitation period and eligibility requirements still need to be checked.
Travel From Home to Work: A Five-Hour Commute Is Still a Commute
Most employees know that the ordinary cost of commuting between home and work is personal and therefore generally not deductible.
But what if your commute is extraordinary?
What if your primary home is more than five hours away from your workplace and you have to maintain another residence near work?
That question was considered by the Tax Court of Canada in Paetz v. The King, 2026 TCC 116. [minicounsel.ca], [caselawwire.com]
The taxpayer maintained his primary residence in Kimberley, British Columbia, but worked in Salmon Arm and later Kelowna. His employers required him to attend the workplace Monday through Friday, so he rented accommodation closer to work and periodically travelled back to Kimberley. He claimed lodging, vehicle mileage, hydro and internet expenses for his 2021 and 2022 taxation years. [minicounsel.ca], [caselawwire.com]
CRA denied the expenses and the Tax Court dismissed the taxpayer’s appeal.
Distance doesn’t change the fundamental rule
The Court concluded that travelling between the taxpayer’s home and his employers’ workplaces remained personal commuting, despite the exceptional distance involved. The expenses enabled him to get to work rather than being incurred in performing his employment duties. [caselawwire.com], [minicounsel.ca]
There was another important problem. The T2200 forms supplied by the employers did not properly establish the statutory conditions necessary for the claimed deductions. [minicounsel.ca], [caselawwire.com]
The case therefore reinforces two points.
First, a very long or inconvenient commute does not automatically transform personal travel into deductible employment travel.
Second, employees seeking employment-expense deductions need to ensure that the requirements of the Income Tax Act are actually satisfied and, where required, appropriately supported by the employer’s Form T2200, Declaration of Conditions of Employment. [minicounsel.ca], [caselawwire.com]
The takeaway: Unfortunately, an exceptionally long commute is still a commute. Distance alone does not convert the personal cost of getting to your regular workplace into a deductible employment expense.
The Bottom Line
These six developments have something important in common: relatively ordinary decisions can create unexpected legal or tax consequences.
Digital assets deserve a place in estate planning. Taxpayer information requires increasingly careful protection. Trustees need to understand the rapidly evolving Schedule 15 reporting requirements. CRA disputes require immediate attention to statutory deadlines. Businesses discovering missed ITCs need to consider both the correct reporting period and limitation periods. And employees should not assume that unusual commuting arrangements automatically create deductible employment expenses. [alri.ualberta.ca], [priv.gc.ca], [canada.ca], [caselawwire.com], [canada.ca], [minicounsel.ca]
Because each of these rules depends heavily on the taxpayer’s particular facts and circumstances, what applies to one individual, business, trust or estate may not apply to another.
Have questions about how these developments affect you?
If you are an FK LLP client and would like additional information about any of the topics discussed above, we encourage you to reach out directly to your tax advisor at FK LLP. Your advisor can help you understand the rules, identify any reporting or planning considerations, and determine how these developments may apply to your specific circumstances.
This publication has been prepared by FK LLP for general informational purposes only. It is not intended to provide, and should not be relied upon as, accounting, tax, legal or other professional advice. Tax and legal consequences depend on the specific facts and circumstances of each situation.
Sources
- Wada Estate (Re), 2026 ABKB 309, Court of King’s Bench of Alberta, April 21, 2026. [dentonsdata.com], [alri.ualberta.ca]
- Office of the Privacy Commissioner of Canada, Investigation of Unauthorized Disclosures and Modifications of Taxpayer Personal Information at the Canada Revenue Agency, May 7, 2026. [priv.gc.ca], [priv.gc.ca]
- Canada Revenue Agency, Enhanced reporting rules for trusts and bare trusts: Frequently asked questions, updated June 2026. [canada.ca]
- Lev v. Canada (National Revenue), 2026 FC 902, Federal Court, July 6, 2026. [caselawwire.com]
- Canada Revenue Agency, GST/HST Policy Statement P-149, Administrative Policy Regarding Adjustment to the GST/HST Return, updated June 23, 2026. [canada.ca], [canada.ca]
- Paetz v. The King, 2026 TCC 116, Tax Court of Canada, June 22, 2026. [minicounsel.ca], [caselawwire.com]
