In Ontario, a beneficiary under a will or an intestacy cannot be compelled to accept a gift. A beneficiary has the option of choosing whether to accept an inheritance or a gift, or alternatively, whether to not accept, or in legalese, to “disclaim” an inheritance.
What Does It Mean for a Beneficiary under a Will or an Intestacy to Disclaim an Inheritance?
Dating back to the English Chancery Courts, if a beneficiary disclaims a gift to which they are entitled to receive at law, the gift is considered void ab initio – it never existed in the first place.
Under section 23 of the Succession Law Reform Act, a gift or “bequest” that “becomes void by reasons of being disclaimed is included in the residue” of the estate. If the disclaiming beneficiary also disclaims a residual share of the estate, there may be a partial intestacy. In such event, the disclaiming beneficiary is considered to have predeceased the testator.
A beneficiary who disclaims a gift cannot (then) decide who becomes the recipient of that gift. If the gift is a specific bequest in the testator’s will, and a contrary intention is provided in the will in the event the named beneficiary predeceases the testator (i.e., gift over), the gift will pass to the “alternate” beneficiary. If there is no gift over provided for in the will, the gift will again form part of the residue of the estate. If it was (initially) a residual beneficiary disclaiming a gift, there again may be a partial intestacy.
A beneficiary is not permitted to partially disclaim a gift. The disclaimer must be all or nothing, as held in Re Skinner, 1970 CanLII 360 (ON SC). That being said, if for example, a beneficiary is entitled to multiple gifts under the testator’s will, they may disclaim one gift and accept the other(s), unless the gift(s) are inextricably bound together in which case the disclaimer must again, only be all or nothing.
How To Effectively Disclaim an Inheritance
First and foremost, a beneficiary can only disclaim a gift following the testator’s death, even if they were aware of the gift beforehand (i.e., had reviewed a copy of the will during the testator’s lifetime).
While the testator is alive, a beneficiary under a will has no existing interest in the testator’s estate, which does not come into existence until death. For instance, a testator, while alive and assuming they have the requisite mental capacity, may amend their will, or a beneficiary under a will may predecease the testator. The law is unequivocal in holding that a disclaimer of a gift is not effective, unless it is made after death, at which time the gift comes into effect.
A disclaimer may be provided orally or in writing; however, it must be provided before acceptance of a gift has taken place in any shape or form. If the executors of an estate determine that a beneficiary has accepted a gift, it may no longer be possible for the beneficiary to disclaim that gift. In this regard, as a practical matter, a beneficiary may want to disclaim a gift sooner rather than later, as any delay may be perceived as acceptance.
Even if a disclaimer is made orally or in writing and prior to acceptance of a gift, it may still fail if the beneficiary lacks the requisite mental capacity to disclaim or has been unduly influenced.
Reasons a Beneficiary May Elect to Disclaim an Inheritance
There are a number of reasons why a beneficiary under a will or an intestacy may elect to disclaim a gift:
- The beneficiary simply does not want the gift, perhaps because they have no use for it;
- The beneficiary is in debt, and would like to avoid creditors; however, this may not be possible if the beneficiary has filed for bankruptcy; and
- The beneficiary is a life tenant of a trust and would like to “accelerate” the gift to the remainder or capital beneficiary(s) of the trust, to effect an earlier distribution.
Key Takeaways
A beneficiary under a will or intestacy has the right to not accept and “disclaim” an inheritance. However, to best ensure that any such disclaimer is effective, upon the testator’s death, a beneficiary should obtain legal advice from an experienced estate lawyer, and as soon as reasonably possible; otherwise, they risk accepting a gift, even if that was not their desired intention.
For Further Reading
Check out some of our firm’s previous blogs related to beneficiaries as well as estate administration:
Beneficiary Designations for Registered Accounts: Do You Really Want the Courts to Get Involved? – July 8, 2025
Navigating an Estate Administration: Key Concerns and Deadlines – June 21, 2022
Beneficiary Designations: When Less is Not More – February 15, 2013
— Josh Cohen