Written by Owen Thompson on February 14, 2018
Administering the estate of a family member or loved one who has passed away is always a difficult task. This process can be made more challenging if the deceased person did not leave a will or if a process often known as “probate” is required.
“Probate” is a court process now known in Ontario as “Application for Certificate of Appointment of Estate Trustee”. As this is a lengthy title, it is still often referred to as “probate” for ease of reference. This process is required where the deceased did not leave a will, or where a deceased left a will and owns assets that must pass according to that will (such as bank accounts, investments, or real estate). The Application is a court process that requires named beneficiaries to be notified (or in the case of no will, those beneficiaries who are determined by the Succession Law Reform Act), the estate assets to be accurately valued, and the necessary documents to be filed with the court, including the original will of the deceased person.
Determining if probate is required can be a difficult task. If there is no will, a family member or person involved in the affairs of the deceased will most likely have to apply to the court to become the estate trustee, in order to deal with the estate’s assets. If there is a will, the specific person or people named in the will as the estate trustee or “executor” will be the ones to complete the probate application process.
The result of probate is the “Certificate of Appointment of Estate Trustee” which is the official seal of the court confirming the person or people named in the Certificate as the estate trustees. This Certificate will be required in order to manage bank accounts, investments, real estate, vehicles, and other assets that were solely owned by a deceased person.
There are some assets that can pass to beneficiaries without probate—jointly owned bank accounts and jointly owned real estate are examples of that. A jointly owned asset can continue to be accessed and used by the other joint owner or owners after the death of the deceased person. Jointly owned real estate can be dealt with by way of a survivorship application, which a real estate lawyer can assist with. It is not a court procedure but is a change of title in the Land Registry Office to remove the deceased person’s name from title to that property.
Probate also requires Estate Administration Tax to be paid at the time the application is filed. Estate Administration Tax in Ontario is charged at a rate of 0.5% on the first $50,000.00 of value of an estate, and 1.5% on anything above $50,000.00. If there are not enough liquid assets in the estate to pay the tax owing at the time of filing, the estate trustee may have to lend the estate the money to be paid back once the Certificate is granted and the estate assets can be liquified. In extreme circumstances, the estate trustee can make an application to the court asking for the Estate Administration Taxes to be postponed until the estate assets are sold. This is at the discretion of the court and may or may not be granted, depending on the reasons given.
If you require assistance with a probate application, estate administration tasks, or a survivorship application, contact us!