What is Probate?
After a person dies in Ontario, the executor may need to have the deceased’s Will “probated” by the Superior Court of Justice in order to obtain a “Certificate of Appointment of Estate Trustee With (or Without) a Will”.
The Certificate of Appointment of Estate Trustee With (or Without) a Will” may be required in order for the executor to access the deceased’s bank accounts and sell the deceased’s real estate.
What is Probate Tax?
“Probate tax,” also known as “Estate Administration Tax”. is imposed on the value of all the property that belonged to the deceased at the time of his or her death less the actual value of any encumbrance on real property (e.g. the outstanding balance on a mortgage).
In Ontario the rates are as follows:
$5.00 for each $1000 or part thereof, of the first $50,000 of the value of the estate;
$15 for each $1000 or part thereof, of the value of the estate exceeding $50,000.00.
No tax is payable if the value of the estate is $1000 or less.
Executors should keep records and supporting documents with respect to estate assets for four years after the probate certificate is issued as the Ministry of Finance may assess for probate tax payable within four years after probate tax became payable.
What is the Estate Information Return?
A recent additional requirement is that executors are required to file an Estate Information Return with the Ministry of Finance within 90 calendar days after they receive the Certificate of Appointment of Estate Trustee.
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