facebook twitter instagram linkedin google youtube vimeo tumblr yelp rss email podcast phone blog search brokercheck brokercheck Play Pause

WHAT DOES "EAT” MEAN?

Every province and territory in Canada charges a fee or tax when a will is probated. Ontario charges more than all others under its Estate Administration Fee ("EAT”). For every $1 million of value the tax is $15,000. Given the current value of real estate in Ontario, it is quite common to have an estate exceed $1 million in total value.

"Probate” refers to the filing process in the provincial or territorial office where the deceased died. The probate applicant, usually the executor named in the will, produces a detailed outline of the assets held in the estate and their value, including , jewelry, home and cottage, safe deposit box contents, cash in the bank, shares and bonds and personal effects. The office stamps the will as having been "probated" and the executor can then commence the process of transferring the property to the heirs named in the will, and can sell any real estate. The will itself is thereafter publicly available.

Since few executors have been through the process it is common to retain a lawyer to prepare the documents and to retain an accountant to deal with the estate's income tax obligations.

There are some alternatives to probate. Real estate held in joint names will typically be transferred to the surviving co-owner. For larger estates a Trust is often used to hold the assets and they are paid out over many years to the trust beneficiaries. Some successfully gift their estate before death to the children or grandchildren or even to friends or charities.

For those who are investing savings like the proceeds on the sale of a cottage, or home, a segregated fund is an efficient and private way of avoiding probate and its costs and delays. A "segregated fund” is similar to a mutual fund, with a wide variety of Canadian and foreign stocks and bonds held in pools and managed by experienced managers employed by the life insurer or by similar investment managers in companies retained by the insurer because of their track record in managing their own pools. However, the contract always allows for beneficiaries to be named or alternatively allows for designated successor owners of the contract. Consequently these investments are quickly transferred to the named persons, typically within three weeks of receiving the signed claim form and a copy of the Funeral Director's Certificate of Death.

This view of your site was created for easy annotation. To view your staging site please visit: https://davidj-7803605.app.twentyoverten.com
To make edits to your site's copy please use the Google Doc link that was emailed to you.