What is inheritance?
Inheritance is the distribution of a person’s property when they die. Generally, if a person died with a valid Will, the deceased’s estate is responsible for distributing the deceased’s assets to the beneficiaries under the Will. If a person died without a valid Will, they are deemed to have died “intestate”. When a person dies intestate, their property is distributed in accordance with Ontario’s Succession Law Reform Act.
Who can receive an inheritance?
If the deceased had a Will, the Will generally states who would be entitled to receive the inheritance. Receivers of this inheritance under a Will are referred to as “beneficiaries”. If the deceased died intestate, the Ontario’s Succession Law Reform Act will determine who is entitled to inherit the property of the deceased.
Is inheritance taxable?
As a beneficiary, it is not necessary to claim inheritance you receive on your annual income tax filing. Although there is no inheritance tax owed by beneficiaries in Canada, the deceased’s estate may be required to pay taxes owed to the government.
If the deceased’s legal representative (the “executor“) is required to seek probate, a portion of the net value of the deceased’s estate may be subject to estate administration tax payable to the Minister of Finance.
Separately, the executor must file the deceased’s tax return with the Canada Revenue Agency within a period of time following the deceased’s death. If the tax return shows that taxes are owing, those taxes are paid from the deceased’s estate before the inheritance can be distributed.
How much inheritance can I receive tax-free?
This depends on a number of factors including the kind of asset being inherited, the relation of the beneficiary to the deceased, and the amount being inherited. For example:
- if the deceased had a jointly-owned property with another person, the surviving joint owner may be entitled to receive the whole of the property tax-free; and
- if the property of the deceased has a designated beneficiary (e.g. a life insurance policy), that property may pass to the designated beneficiary tax-free.
How long does it take to receive an inheritance?
This will depend on a number of factors. Just to name a few, it can depend on: the type of property being inherited; whether probate is required; the value of that property; and the number of beneficiaries involved. Although a simple estate may be closed within a few months, more complex estates can take one or more years to close. As a beneficiary, it can take up to a year to receive your inheritance.
How can I protect my inheritance if my beneficiary gets divorced?
Wills can provide a clause to address this issue. The purpose of this clause is to give your beneficiaries who have married the choice of how they wish to deal with their inheritance. Beneficiaries who wish to avoid commingling their inheritance with their spouse should keep that inheritance separate from any marital property and any jointly-held property (i.e. joint bank accounts, joint tenancy on real property, etc.).
How can I ensure my inheritance is passed to my beneficiaries properly?
Arguably the least expensive and most hassle-free way to provide for your beneficiaries in case of your death is to have a Will prepared.
A Will allows you to direct how your personal and real estate property is to be distributed on your death.
Hummingbird Lawyers LLP has two offices for your convenience. Providing qualified, skilled and experienced lawyers in Toronto and lawyers in Vaughan, we are committed to giving our clients the convenience, expertise and guidance they need.
Whether you want to update your Will, or are interested in getting a Will done for the first time, we can help you.
Call us today at 905-731-1911 ext. 218 to schedule a time to speak with one of our Wills & Estates lawyers.
Bets can normally be made on which player is going to make the highest break during a tournament and also how big that break is going to be. Then you divide each of the value numbers by this total number and multiply it by 100. For latest daily tips see our homepage read more…. Bookies are offering a matched racing bonus bet to customers who place their first racing bet with them.