Many people consider funeral preplanning and prepayment from an emotion perspective. Often people
tell me that they are relieved and have a sense of pride and peace of mind, knowing that their wishes
are documented and that their families will not be burdened with the cost of a funeral at the time of
In addition to the emotional advantages of prepaying for a funeral, there are also several financial
People are often surprised and relieved to learn that prepaid funeral funds are held in a guaranteed and
insured certificate issued in the purchaser’s name. The Federal Government allows the first $15,000 in
an Eligible Funeral Arrangement (EFA) to earn tax exempt interest during the purchaser’s lifetime. This
interest is credited and compounding in the beneficiary’s certificate. When the funeral is needed, it is
paid for from the certificate.
If the future funeral cost is guaranteed and there are surplus finds in the EFA then this money is
returned to the estate of the deceased. Alternately the residual money may be used to pay for
unfunded funeral expenses, such as flowers, newspaper notices, reception food or other items decided
by the executor.
Another option is to gift the residual certificate funds to a registered charity. In this scenario the estate
of the deceased is not taxed on this money and the estate will receive a charitable donation receipt.
This money may then be eligible as a charitable donation deduction in the year the final income tax is
If you would like to know more about this and how it applies to your situation please contact Kat.
Katherine Downey is the #1 Funeral Preplanning Professional in Canada for the fourth time. She is a
professional educator and licensed funeral director specializing in prepaid funeral planning. To set an
appointment or have your questions answered contact her at: 905?717?9197 or
firstname.lastname@example.org. She also invites you to visit her website at www.legacymatters.ca
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