Why Should You Make A Will?

One of the most important reasons to make a Will would be to ensure that your property will pass to your intended beneficiary after your death, instead of leaving this decision up to the law.

In Ontario, the rules on who will receive property after death is governed by the Succession Law Reform Act (SLRA). The SLRA rules apply depending on who are the closest surviving relatives of the deceased. For example, if the deceased is survived by a spouse and there are no children, the spouse inherits the entire estate. If the deceased is survived by a spouse and children, the spouse receives the first $350,000 and the remaining amount will be divided equally between the spouse and children. If the deceased does not have a spouse at the time of death but is survived by children, the children will share in the estate equally. These rules will apply if the deceased died without a Will. However, if the deceased died with a Will, the provisions in the Will will override the SLRA rules on intestacy.

By making a Will, you will also have the opportunity to appoint an executor or administrator (trustee) of your estate of your own choosing. Without a Will, the decision will be left to the courts upon an application by anyone suitable for such a role.

For parents with minor children, an added benefit of having a Will is the ability to appoint a guardian for your minor children in your Will. It should be noted that the appointment of a guardian for minor children in a Will is effective for only 90 days. Within the 90-day period, the guardian will have to apply to a court to be appointed by a judge. In most cases, the judge will respect the parent’s choice of a guardian found in a Will, unless circumstances exists where the appointment of another person would be in the best interests of the child.

For individuals who own shares in a private corporation, another good reason to make a Will is that the Estate Administration Tax (the “EAT”) could be minimized with a secondary Will. The EAT is payable when a Certificate of Appointment of Estate Trustee is required from the court (“Probate”) in order to transfer real estate property in Ontario or to access bank accounts of the deceased. The amount payable for the EAT is 1.5% of the value of the estate over $50,000. This means that for an estate worth $1 million, $14,250 of EAT is payable. Importantly, for business owners who own shares in private corporations, a secondary Will can be created to exclude assets that do not require Probate from being subject to the EAT. In this case, a primary Will will contain only assets in the estate that require Probate, which will be submitted to the court for Probate after death, with the EAT payable only on the value of these assets. The rest of the assets of the estate that do not require Probate, including the corporate shares, will be contained in a secondary Will, which do not need to be submitted to the court for Probate and for which no EAT will be payable. This could result in significant savings on the EAT.

For more information on how to make a Will in Ontario, call our office and speak with Catherine at 289 291 3977 or email us at catherine@changallivanlaw.com. We offer our services in English and Mandarin.

Author: Angeline Gallivan

Disclaimer: Information provided on this website is provided as a courtesy to you and does not constitute legal advise applicable for your unique circumstances. Your use of any information provided here does not create a lawyer-client relationship between yourself and our lawyer. To obtain advise specific to your legal situation, please contact us at 289-291 3977 or info@changallivanlaw.com.