Even when someone dies, his or her debts must be paid. Those payments come from the person's estate. It's only after those debts have been taken care of and other expenses like funeral costs, taxes, legal fees and probate fees, if any, have been met that beneficiaries receive what they have been bequeathed. There are some prudent steps individuals can use to minimize those payments when estate planning.
Choosing the right executors ensure last wishes are fulfilled
Choosing the right person to look after the handling of assets is a large part of successful estate planning. Executors are those (there can be more than one) who will ensure the last wishes of the deceased individual in Ontario are carried out. It's a duty that requires both time and decision-making skills. It's important to ask an individual whether he or she would be willing to act as executor instead of simply naming the person in a will.
Canada estate planning: The workings of advance care directives
No one likes to think about getting sick but making plans for unforeseen events could make things much less stressful for loved ones. Estate planning could include an advance care directive -- a document that stipulates a person's wishes regarding medical care should the individual be incapacitated and thus unable to make those decisions. Those in Canada who have a serious illness might wish to discuss their wishes with their health care teams as well as family members, but having a document in place is a wise move.
Estate planning in Canada for the best tax outcome
There is an old adage that says the only certainties in life are death and taxes. In estate planning, the two seem to go hand-in-hand but that doesn't mean the Canada Revenue Agency (CRA) should turn out to be an estate's primary beneficiary. For those who don't wish to leave almost half of their assets to the government, savvy estate planning is crucial. When someone dies, the CRA deems their assets as having been disposed of even if they haven't, in fact, been sold. Those assets are then taxed using a fair market value.
