Your Final Tax Bill
Did you know that after you pass away, all of your assets (investments, cottages, home, etc) are pooled together and the government will tax you based on the value of the assets as part of your final tax bill. The tax has to be paid by the deceased person’s estate.
Basically, after you pass away, you still have one big bill left to pay to the government. Most don’t plan for this – but it’s a guarantee that one day we’ll all pass away.
A New Legislation for Estate Taxes
Executors will now be required to report much more detailed information regarding the value of assets in an estate. You can understand why the government would put this into place as it is a large source of income for them. The problem is that some estate trustees have been very conservative in estimating asset values, therefore having to pay less tax.
To combat this, as of Jan 1 this year, estate trustees are now required to file an “Estate Information Return” within 90 days of being issued a probate certificate by the provincial government. If the government thinks an estate’s value is underestimated, it can issue a reassessment up to 4 years after the issuance of the probate certificate.
Probate taxes are $5 for each $1,000, up to $50,000 ($250, if maxed) and 1.5% of the estate thereafter.
If you are currently an executor and have any questions or concerns, please forward them in an email to firstname.lastname@example.org