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September 2014 Archives

How is an estate distributed if a will was not made?

When a resident of Ontario dies without a will, also called dying intestate, the person's property is distributed pursuant to the terms of the Succession Law Reform Act. Generally speaking, property is distributed first to the surviving spouse, if any, and then to children and other relatives. Only blood relatives, including adopted children and children born outside of marriage, can inherit from the estate. Half-blood relatives are treated the same as whole-blood relatives under the Act. The preference of the law is to distribute the decedent's estate to his or her nearest possible relatives.

What taxes will my estate be responsible for?

When an individual in Ontario passes on, that person's estate may be require to pay certain taxes. At the time of death, the executor of an estate is required to file a terminal tax return on that person's behalf. Any capital property that is owned by an individual will be considered sold just before the person's death. Therefore, there may be capital gains or capital losses that affect how much tax an estate owes.

What is the estate administration tax and how much will it be?

When a person dies in Ontario, someone has to administer their estate. Administrators were previously appointed during probate. However, a person now gains the authority to administer an estate by obtaining a certificate from the Superior Court of Justice. As part of that process, an estate administration tax must be paid when an application for a certificate is submitted.

Couples should take time to plan for the death of a spouse

Financial advisers say it is important for Ontario couples to discuss their finances and be prepared for the death of a spouse. Otherwise, the loss of a spouse can put an enormous financial strain on the survivor. Reports indicate that many Canadians do not have wills. Excuses often heard include not being able to decide on an executor or a specific guardian because a person is afraid they will change their mind.

Legal guardians' duties are clearly defined

Citizens of Ontario who appoint legal guardians as property caretakers for incapable individuals, such as elderly family members, may be interested to learn that the duties and powers of such guardians are limited by established legislation. According to the Ontario Ministry of the Attorney General, guardians do not gain ownership of an incapacitated person's property, but they nonetheless play a crucial role in the management and maintenance thereof.