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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.

The amount of the tax is based on the value of the estate. It may be calculated and paid on an estimated value if it is trued up within six months. This process requires that the personal representative submit an estimated estate value and pay a tax based on that amount. Then, within six months, the personal representative must submit the actual value and pay any additional taxes due.

For the first $50,000 of estate value, the tax is calculated at the rate of $5 per $1,000 of estate value. For all estate value over $50,000, the rate is $15 per $1,000 of estate value. As an example, suppose the state is valued at $100,000. The first $50,000 would be calculated at $5 x 50 = $250.00. The second $50,000 would be calculated at $15 x 50 = $750.00. The total tax due would be $250 + $750 = $1,000.

Estate administration can be a daunting task for anyone unfamiliar with the process due to the financial and administrative tasks involved. This is especially true if the administrator is also suffering grief over the loss of a loved one. Anyone who needs help administering an estate may want to enlist the services of a lawyer who has experience in estate matters.

Source: Ontario Ministry of the Attorney General, "Frequently Asked Questions About Estates", September 11, 2014

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