(NC)-There are no estate taxes or succession duties in Canada. However, taxes upon death have not vanished. When a person dies, there is a ‘deemed personality’ of all capital residential or commercial property. Exactly what does that suggest? It suggests that the government treats all your home or business (unless jointly held) such stocks, bonds, RRSPs, realty, etc as sold at reasonable market value on the day of your death. Your estate will be required to pay capital gains tax on that home. This applies to your RRSP if you do not have a spouse to whom you can transfer it. Careful preparation can lower or postpone the taxes owing. Without an estate plan, you could lose almost half of the worth of your gains to taxes. While your Executor might claim full individual exemptions on your last tax return, your estate might wind up paying taxes at the greatest tax rate (over 50%). If you do not have a Will, or if your Will has not been upgraded recently, it might be a good time to get the job done to prevent tax issues.
Exactly what is Probate?
“Probate” is the acknowledgment by the provincial court of the validity of your Will and the appointment of the individual called as your Administrator. Granting of the “letters probate” is notification to the general public that your Will complies with the fundamental official requirements and that the Will was not being challenged at the time of application.
Decreasing Probate Costs
In some provinces, the Administrator must use to the court for “letters probate” in order to begin administering an estate. These fees are payable to the provincial government based upon the value of particular assets in your estate. There have actually been increases throughout the years in provincial probate costs. There are methods to arrange your affairs to lower these probate charges. Again, estate preparation helps recognize these concerns and lower any unfavorable influence on your estate.
It sounds complicated!
Estate preparing need not be complicated or pricey. First, who understands better than you what you want done with the things that you’ve worked all your life to develop. Second, seek the professional guidance of a professional to assist you on the financial and legal implications to ensure that you get the most favourable tax treatment possible.
If you do not have a Will, or if your Will has not been updated just recently, possibly it is time to meet with a legal representative and get the job done. Take the first step; call Ontario March of Dimes toll-free at 1-800-263-3463 x 383 for a complimentary copy of “My Individual Organizer” – a helpful estate preparation tool.