Christian Credit Union
Personal BankingBusiness BankingFinancial PlanningInsurance PlanningNext Steps for Young AdultsYouth Banking Program


The staff are wonderful to deal with, always happy to help you out. They made me feel like family, not just a person. Justine went above and beyond to help me out. When she was taking care of my son’s...read more
Michelle BrittonSatisfied Member

Estate Planning

Are there Estate Taxes when I pass away?

December 27, 2012

This question was posed by one of our members recently.  The short answer is No, not in Canada.  Despite the snow and cold, we have a lot to be thankful for living in Canada! But there’s more to the answer: probate fees and taxes due on the final tax return.

Probate is a process where the Court declares that the Will is valid and enforceable. Probate establishes that the Executor(s) also known as Personal Representative(s) can settle the estate.  The estate is what the deceased owned less what is owed at the time of death. If the deceased owned real estate, probate is required. Most financial institutions also require probate.

The maximum probate fee for residents of Alberta is $400 regardless of the size of the estate. Most Executors use a lawyer to complete and submit forms to the Court and subsequently charge a fee between 1-2.5% of the estate size (e.g. estate size $500,000 x 2.50% = $12,500). Some lawyers charge a flat fee or work on an hourly basis. Please note that most articles in newspapers and magazines on estates originate out of Ontario where probate fees are considerably higher @ 1.50% for estates over $50,000 followed closely by British Columbia @ 1.4%
 
All assets of the estate are deemed disposed of at the time of death. As a result, balances in RRSP/RRIF and capital gains on rental properties, cabins, shares that have appreciated in value, etc. are claimed on the final tax return of the deceased which is likely to cause a tax liability. One way to reduce or eliminate the taxes is to contribute to charities in your Will.* Note that any gains on primary residences are tax-free. 

The good news is that inheritances received by the beneficiaries are tax-free.

 

*Kindly refer to “Leaving a Legacy, Transforming this World.”


‹ Go Back | Share Post


News & Events

HOLIDAY HOURS
Monday, December 25 - CLOSED    Tuesday, December 26 - CLOSED      Monday, January 1 - CLOSED The staff and board wish you a blessed Christmas and a prosperous New Year.  ...

Read More ›

In the Community

Immanuel Christian High School Trades Building
Immanuel Christian High School has been improving its vocational training program over the years. They have been renting an off-site facility to teach wood working...

Read More ›

Fraud Prevention

Be Fraud Smart
Identity theft and financial scams are among the fastest growing crimes in North America. It can happen to anyone. Criminals are becoming more sophisticated, using...

Read More ›