February 13, 2016

Automatic Revocation of Wills

AUTOMATIC REVOCATION OF WILLS IS MANDATED BY LAW IN ONTARIO

There are situations where a validly drawn will can be automatically revoked with no express intention on the part of the owner of the Will. The two most common situations where this occurs are marriage and divorce.

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The Importance of Date of Separation

HOW DOES THE DATE OF SEPARATION IMPACT THE DIVORCE PROCESS?

An important early legal step in a divorce is determining the date of separation. The date of separation is referred to as the valuation date in family law. It is very significant in two ways:

1) it determines when you are able to get a divorce as typically you must be separated from your spouse for one year prior to obtaining a divorce;

2) the value of your assets on that particular day will determine how your property is divided between you and your spouse.

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Update on Estate Administration Tax (Probate Tax)

G+G Probate Tax

STILL NO REGULATIONS UNDER THE ESTATE ADMINISTRATION TAX ACT

Probate Tax (technically called Estate Administration Tax) has been in place in Ontario for a number of years. For details on this tax check out this Blog Ontario Probate Tax 2013.

Until December 31, 2012 the Courts were responsible for the collection of Probate Tax. Effective January 1, 2013, the collection responsibility passed to the Ministry of Finance (the same people who previously collected Retail Sales Tax in Ontario before HST). [Read more…]

No Will, Spouse or Children: Where Do Your Assets Go on Death?

Contrary to popular belief, the government does not automatically take the assets of a person who dies without a will leaving no spouse or children to inherit. The Succession Law Reform Act provides for parents, siblings, nieces and nephews to inherit if no spouse or children survived the deceased. Even if a person dies leaving no parents, siblings, nieces, or nephews, the government would not be next in line for a deceased’s assets. [Read more…]

Treatment of CPP Death Benefit by the Estate

CPP DEATH BENEFIT AND HOW THE ESTATE NEEDS TO HANDLE IT

If you have contributed to the Canada Pension Plan (“CPP”), you will be entitled to a CPP death on your death. The amount of the death benefit will depend on the number of CPP credits you have accumulated. The current maximum death benefit is $2,500.00.

The CPP death benefit is income to the estate and taxable as such (believe it or not). It is also an estate asset on which executor’s compensation is payable. It will also be included in the value of the estate for the purposes of distribution among the beneficiaries. [Read more…]

Security Bond for Statutory Guardian

STATUTORY GUARDIAN – SECURITY BOND

The Public Guardian & Trustee (“PGT”) of Ontario becomes the statutory guardian of any person in Ontario who becomes incapable without having a Continuing Power of Attorney for Property. It is possible for someone (usually a relative) to apply to replace the PGT and become a substitute guardian. [Read more…]

Holograph Will – Write your own Will

WRITING YOUR OWN WILL IS REFERRED TO AS A HOLOGRAPH WILL

Contrary to popular belief, an Ontario Will may be valid even if there are no witnesses to the Will.

If a Will is made entirely in the handwriting of the testator (person making the Will) and signed by that person, no witnesses are required to sign the Will. Such a Will is called a Holograph Will. [Read more…]

Investments Under Power of Attorney

G+G POA Investments

ESTATE ADMINISTRATION – INVESTMENTS UNDER POWER OF ATTORNEY

An Attorney acting under a Power of Attorney for Property is required to be careful with investments. If the Power of Attorney for Property of the incapacitated person gives specific authority to make certain types of investments, an attorney can make those investments. Otherwise, an attorney should assume that they will be held liable by the incapacitated person or the beneficiaries of their estate when they die (even though they may not actually be liable) for any losses and invest conservatively. [Read more…]

Probate Tax – How much does it cost?

G+G Calculator

PROBATE TAX – WHAT IS IT AND HOW MUCH DOES IT COST?

What is Probate tax? It is a provincial tax imposed on the deceased’s estate under the control of an executor or administrator.

How much will the probate tax be on an estate? Here is a simple approach to calculating the tax. [Read more…]

Estate Investments

G+G Estate Investments

ESTATE ADMINISTRATION – ESTATE INVESTMENTS

An Estate Trustee (Executor) is required to be careful with estate investments. If the Last Will and Testament of the deceased person gives specific authority to make certain types of investments, an executor can make those investments. Otherwise, an executor should assume that they will be held liable by beneficiaries of an estate (even though they may not actually be liable) for any losses and invest conservatively. [Read more…]