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Have you planned how the distribution of your assets will affect your dependents?

On Behalf of | Nov 14, 2016 | Estate Planning

Generally, in Ontario, you can bequeath your estate assets however you choose. There are exceptions, however.

For example, if you have dependents, and if your estate plan fails to provide for them, the Succession Law Reform Act allows for your estate to be challenged in court for the purpose of providing for the dependents.

In such a situation, estate assets, along with assets considered to be outside of the estate, could be “clawed back.” The assets would then be used to support the dependents who were otherwise overlooked in the estate plan.

Assets outside of the estate may include your registered retirement savings plan (RRSP), proceeds from an insurance policy, property you held jointly with another party, and gifts you made in contemplation of death. All of these kinds of assets, which may not be considered to be part of the estate, could be clawed back to provide for a dependent if your estate plan doesn’t already make such provisions.

Of course, this unfortunate scenario can be avoided by considering how your dependents will be affected by the distribution of your assets — and by planning now.

For more on estate planning in Ontario, please see Hagel Lawfirm‘s estate planning overview.


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