When it comes to creating a will, you should also become familiar with the probate process. This approval process is crucial for your estate and your executor. Applying for a probate approval confirms that your executor is the right person to be handling your money after death and ensures they’re using the most recent version of your will. Plus, the process can involve probate fees that will need to be arranged. Taking a closer look at the probate process can help you to properly prepare your will and executor to be ready when it comes to distributing your assets.
When is a Probate Required?
After death, your executor is responsible for securing the assets of the estate, paying your debts, and determining if probate is needed. The situations in which your executor will need to apply for a probate is:
- If you pass away with debts
- If there are bank accounts or registered investments without a named beneficiary
- If there is owned property that isn’t being passed directly to a spouse or common-law partner through joint ownership
Why is a Probate Recommended?
Institutions like your bank will want proof that you passed away, confirmation that your executor is the right person and that they possess the final testament of your will. Many institutions will also want a proof of probate to avoid any legal issues if the will becomes contested.
How Does the Executor Apply?
The executor will need to visit the province’s probate court to be granted probate approval. There are different laws for each province, so it’s important for your executor to understand your province’s rules, approval process, and the costs involved. If they have issues obtaining or understanding the information, they should talk directly to a lawyer.
Are There Fees Involved?
Each province sets out their own specific amount of probate fees. Some charge a flat rate, while others charge a percentage of your assets.
How Can You Better Plan to Distribute Assets?
You can arrange to have two wills; one that will be used to distribute assets that need to go through probate, and one that will be used to distribute assets that do not. Legal counsel can help you arrange to have the two wills properly worded. If this option is not available in your province, you could also give cash gifts to family instead which may be exempt from tax. Another option would be set up a trust or private company to own your assets, this way your assets will not go through probate.
The probate process can be difficult to understand, not only for you, but your executor as well. Hiring a professional who can help guide the both of you through the process can ensure your estate planning goes smoothly and as intended. Book a consultation with your financial advisor at The Beacon Group of Assante Financial Management Ltd. today.