Filing the Trust Income Tax Return
As a rule, a trust subject to Québec income tax for a given taxation year must file form TP-646-V, Trust Income Tax Return, if it has income tax payable for that year.
The taxation year of a graduated rate estate that is wound up ends on the winding-up date, which generally corresponds to the date of distribution of the property. You must therefore file the final return of the trust within 90 days after that date.
In the case of an inter vivos trust, you must file the final return no later than 90 days following the calendar year in which the trust was wound up.
As the trustee, you must provide all the required information concerning the trust's income, deductions and credits in order to facilitate the calculation of its income tax payable. The trust is liable to penalties and penal proceedings if you fail to provide certain information.
Trusts are liable to a late-filing penalty for failing to file their income tax returns on time. When determining the amount of unpaid tax for the purposes of calculating a penalty, we take into account any losses carried forward from a previous taxation year.
If you failed to file a required trust income tax return or filed an incomplete or inaccurate one, you can rectify your tax situation by filing a voluntary disclosure application.