It’s no secret that estate administration takes a great deal of work and attention. Often, the individual chosen to execute a will is one with certain professional skills, such as financial management, organization and communication.
These individuals may be wary about taking on such a large commitment without compensation, because it may take away from time they could be committing to a paid job or personal activities. For this reason, executors in Ontario are entitled to be paid for their work.
Executor compensation is one of the many fees and expenses that may be incurred during the estate administration process. Commissions on home sales, capital gains taxes as well as probate and legal fees may also play a role, depending on the specifics of the estate.
Exactly how much should an executor be paid for his or her services? Generally, courts place the value of the services at about 5% of the estate, along with an additional two-fifths of 1% of the average annual value of the assets during the administration process. It is ideal to discuss these fees upfront with everyone involved in the estate, including all beneficiaries, so that the situation is transparent.
While executors in Ontario have a right to compensation, in some cases, they may choose to forgo payment. This occasionally happens in the case of very close friends and family. However, many change their minds after realizing the volume of work involved in the job.
It’s important to remember that estate planning laws vary by province, so the process tends to run more smoothly when you assign an executor who lives in the same province as you do. Likewise, if you have questions about estate administration and executorship, contacting an estate planning lawyer in your province is a good first step.