The tax rule treating you as having sold everything at fair market value immediately before death, triggering capital gains on the final return.
The Canadian position
A rollover defers the tax where property passes to a spouse or a qualifying spousal trust. Otherwise the gain is realised and taxed.
For a family holding a rental property or a portfolio, this is often the single largest liability the estate faces.
The Islamic position
Tax is a debt of the estate, payable before bequests and shares. The faraid fractions therefore apply to the net figure.
The four Sunni schools are not recorded as differing materially on this point in the sources reviewed. Where your own case turns on it, put it to a scholar of your school.
General information, not legal or religious advice. Inheritance depends entirely on the exact family circumstances. Confirm the Canadian position with a lawyer in your province and any religious ruling with a qualified scholar.
Citations & sources
Every factual claim on this page traces to one of the references below. Legislation and dollar thresholds change — verify against the primary source before relying on any figure.
- Research Papers — Cambridge Muslim College
- Research — Cambridge Muslim College
- Academics — Islamic law and theology curriculum — Zaytuna College
- Encyclopaedia of Islam — Brill
- What to do when someone has died — Canada Revenue Agency
- Income Tax Act, RSC 1985, c 1 (5th Supp) — Justice Laws Canada
- Principal residence exemption — Canada Revenue Agency
- Deemed disposition death canada — Treadstone Law
- Executor liability for estate taxes ontario — Treadstone Law
- Joint ownership non spouse deemed disposition death ontario — Treadstone Law
- Clearance certificate delay affects closing ontario — Treadstone Law
- Dependant support award effect on estate tax ontario — Treadstone Law
- Non resident executor estate tax residency ontario — Treadstone Law
- Wills & estates practice — Treadstone Law