What Is an Estate Defined As?
An Estate in Canada can be defined as the total of someone’s owned assets minus all liabilities (like debt and taxes). It excludes jointly-owned assets like homes and cars, pensions, or life insurance policies.
This estate is considered as a “living estate” if the person is alive and then becomes a “deceased estate” once they pass away.
Assets and Liabilities That Form Part of an Estate and Those That Do Not
In Canada, it is important to note that inheritance law is a provincially legislated and managed matter and would need to be planned for, as well as executed in line with, the laws given in the province. Fortunately, we have developed compliant and easy-to-follow solutions like the Online Planning Funeral Guide for you.
Here are some examples of assets and liabilities that are normally included and excluded:
- Residential and commercial property owned by the individual
- Movable assets like cars, boats, mobile homes, and planes
- Money in the bank (savings or current accounts)
- Shares on a stock or securities exchange
- Investments in a bank
- Life insurance policies
- Pensions and retirements annuities
- All debts due to the bank or individual, owed by the deceased party
- Physical personal possessions with no material value
- Property held in a trust
- Lease agreements
- Life insurance policies (where the diseased is listed as a beneficiary)
- Retirement accounts
- Social Club/Organization memberships
Who and What Are Beneficiaries of An Estate?
In simple terms, a beneficiary of an estate (living or deceased) can be broken up in two types:
- Residual Beneficiaries – These beneficiaries will receive all or part of the estate according to the instructions written in the last will or testament.
- Non-Residual Beneficiaries – These beneficiaries will receive gifts that could include things like jewelry, furniture, personal items, and/or an amount of money.
What Are the Tax Implications for a Deceased Estate?
In Canada, there is no estate or inheritance tax that is collected by the Canada Revenue Agency. There are however estate or probate fees that may be payable upon the death of a Canadian resident. These fees will be collected provincially by the estate’s executor/administrator/personal representative.
Who Will Handle the Estate?
The executor of the estate will be the one that helps appraise, secure, and settle any assets or debts relating to the estate. They will also be the one that submits the disease’s last personal tax return. This will also include applying for probate, if necessary.
Fortunately, providers like the Elephas Group partner with families that have made use of our Final Needs Planning Program and appoint a personal account executive who then helps guide the process for you.
We’ll also assist loved ones with the necessary applications for burial insurance claims, cancelling of any insurance or other programs, and other related matters that will help with the arrangement of the funeral or memorial service.
Other items may include the accounting for identified beneficiaries and distributing of estate assets as well. This individual may or may not be paid for the work done on this estate as they would need to comply with many laws that the court will expect to be administered properly on behalf of the estate.
What to Do Now
Irrespective of your circumstances, it is always advisable to partner with specialists like the Elephas Group that have proven, tried, and tested plans that ensure you are given peace of mind and expert guidance. This will allow your loved ones to more easily cope with their beloved family members having passed away.