We address the key factors limiting charge carrier lifetime in 4H-SiC epilayers by demonstrating a viable method for eliminating carbon vacancy (VC) related Z1/2 lifetime killer sites and by introducing a novel approach in depth-resolved characterization of the carrier lifetimes across the epitaxial layer, which allows monitoring the efficacy of the proposed defect reduction scheme also exposing surface and interface recombination effects. We show that a moderate-temperature annealing conducted at 1500 °C for 6 hours under C-rich thermodynamic equilibrium conditions in effect eliminates carbon vacancies in epilayers to the levels below the detection limit (1011 cm-3) of DLTS measurements. The efficient reduction of VC-related Z1/2 sites upon thermal treatment is further proven by a significant increase of the minority carrier lifetime from 0.3µs to 1 µs, the upper limit apparently set by epilayer thickness dependent lifetime. Equally important is the extensive range of defect elimination as evidenced by consistently enhanced lifetime throughout entire 40 μm-thick epilayer, thus suggesting immediate practical implication as a lifetime control method suitable for variable thickness 4H-SiC epilayers.