Probate or Certificate of Appointment of Estate Trustee

Probate or Certificate of Apointment of Estate Trustee as its now known in Ontario is a court’s legal confirmation of a Will as well as an estate trustee’s authority. Probate is not always required, but mandatory in many estate administrations. Most financial institutions, for example, require proof that they are in fact transacting with the correct version of a deceased’s will and as well as the correct executor. Furthermore, if there is a real estate transaction as part of the estate administration, the land registry office generally requires probate for similar reasons.

Probate also carries with it some benefits for executors, as it will start the clock on the time limit within which certain individuals may make a claim against the estate. Additionally, probate is recommended if there are any beneficiaries that are either a minor child or an adult lacking capacity to consent.

Once the will is filed with the court and the application for probate has been received, the deceased’s will is available through a public search. Additionally, when the application for probate is made, probate fees are also required to be filed.

To calculate probate, certain assets are included and some are exempt. For example, real estate outside of Ontario, insurance owed to beneficiaries, and jointly held property passing outside of a will are exempted from the estate administration tax calculation. Property that passes hands outside of a will typically includes RRSPs, RIFs, and TFSAs. Additionally, assets that are held as a joint ownership between the deceased and another individual usually pass outside of a will. This includes real property as well as bank accounts.

Prior to January 1, 2015, executors who applied for probate certificates were only required to provide the estimated value of the deceased’s estate in addition to a sworn affidavit that confirmed this amount. No detailed supporting information was necessary to prove that the estate’s value was accurate; as a result, asset values could be severely overestimated or underestimated. Therefore, the Ontario government has made probate filing rules stricter.

Based on the new rules, executors who apply for the “Certificate of Appointment of Estate Trustee With (or Without) a Will” must file an “Estate Information Return” within 90 calendar days after the Ontario government initially issues the certificate. The “Estate Information Return” contains a list and corresponding description of each asset, which includes real estate, bank accounts, and vehicles. Feel free to contact Conduct Law for more information about assets that are excluded from the new probate filing rules.

Assets to include in the calculation of probate includes real estate in Ontario that was owned by the deceased alone, or as a tenant in common, shares in a publicly traded company, and funds in a financial institution held in the deceased’s name alone. In Ontario, there is no fee for an estate valued under $1,000.00. There is a $5.00 charge for each $1,000 or part thereof, up to $50,000. For estates with over $50,000, the rate is $250.00 plus $15.00 for each $1,000 or part thereof that exceeds the value of $50,000.

Probate can be expensive. Legal and accounting advice is recommended to properly structure your estate so as to reduce the probate fees required to be paid by your estate. Additionally, it is recommended that you seek the advice of professionals when acting as an executor. The application for probate can be complex and time consuming for many individuals.

Conduct Law is an Ottawa based business law firm with locations in Ottawa, Barrhaven and Kanata.  Our professionals are experienced business lawyers who can help with commercial real estate, liens, incorporations, trademarking or implementing corporate structures that manage tax obligations, whether as a corporation, partnership, family trust, testamentary trust, or any other type of legal entity.

Feel free to call or write one of our professionals at info@conductlaw.com or 613.440.4888 for all of your business, commercial, real estate and estate planning needs.