Helping Clients to Avoid and Minimize Probate Fees and Estate Administration Tax
In 1992, Ontario raised its probate fees (known as Ontario Estate Administration Tax) to approximately 1.5 percent. This rate may sound minimal. However, it is one of the highest rates in North America and, for high net worth individuals and families, equals approximately:
- A $75,000 fee for an estate of $5 million
- A $150,000 fee for an estate of $10 million
- A $300,000 fee for an estate of $20 million
It makes sense to take steps to mitigate this tax, which is paid at the time a will is submitted to the court for probate. At the Toronto, Ontario, law firm of O'Sullivan Estate Lawyers, we have helped many clients minimize probate fees through a range of effective methods, which include:
- Transferring assets to a trust. On death, assets in the trust do not form part of the estate. Probate fees are thus avoided.
- Using multiple wills.
- Transfer of assets to Alberta or other low-probate fee jurisdictions in conjunction with using a separate will for those assets.
- Titling assets to "joint with right of survivorship" so that when one party dies, the other automatically becomes sole owner.
- Effective use of beneficiary designations for RRSPs, RRIFs and life insurance.
Inter vivos gifts, multiple wills and other legal strategies and tools can also be used to avoid Ontario's sizeable probate fees.
To further discuss cost-effective options regarding probate fee minimization, contact our firm. Margaret O'Sullivan is a founding member of the Society of Trust and Estate Practitioners (Canada), is recognized in European and Canadian directories as a leading estate planning lawyer and has practiced in the area of estate planning since being called to the bar in 1983.
Also engaged in trust and estate work at O'Sullivan Estate Lawyers are Susannah Roth, Claudia Sgro and Christopher Kostoff. Ms. Roth has practiced trust and estate law since being called to the bar in 2002, has spoken and written on various subject areas in trust and estate law, and is the current Chair of the Ontario Bar Association Trusts and Estates Executive Committee and a member of Council of the Ontario Bar Association.
Ms. Sgro graduated with distinction from Osgoode Hall Law School, York University, receiving academic awards in tax, estate and trust law. She is a member of the Trusts and Estates Section of the Ontario Bar Association, and a student member of the Society of Trust and Estate Practitioners.
Mr. Kostoff was called to the bar in 2011 after graduating, with distinction, from the University of Western Ontario, where he received several awards for academic excellence. He has co-authored articles on the taxation of partnerships.
To contact an Ontario estate administration tax lawyer at our firm, call 888-365-6235.