No-one likes to think about planning for a Will. But the reality is, is that without a Will, your assets will not be distributed the way you want them to be. Wills allow you to allocate your assets in a manner that is suitable for you and your family, and more specifically, allow you to choose the trusted person (knows as your Estate Trustee or Executor) that you want to distribute your assets and pay off your debts in accordance with your instructions.
If you die without a Will (known as dying Intestate or Intestacy), a court will appoint someone to administer your Estate for you. This appointment may cause increased costs and time delays in administering your Estate (versus dying with a Will whereby the Estate Trustee/Executor is appointed by the deceased). The person to be appointed must apply to the court for a Certificate of Appointment of Estate Trustee Without a Will. The court follows a priority list of persons in choosing who will be appointed, starting with the surviving spouse (note that a common-law spouse has the same priority as a lawful spouse in becoming an administrator of an estate), followed by the children, grandchildren, parents, siblings and finally, distant relatives. In administering your Estate, if you have surviving family, your assets will not go to the government. The Court-Appointed Estate Trustee will be required to distribute your Estate according to provincial laws (Part II of the Succession Law Reform Act, R.S.O. 1990, Chapter S.26). Consequently, the distribution by the Court-Appointed Trustee may not suit your personal wishes or a beneficiary's needs. Accordingly, creating a Will is essential and crucial to planning for your family's future. To see how your Estate will be divided if you die without a Will, please click here.
The Will is vital in the estate planning process. It is a formal record that specifies how your Estate will be distributed upon your death. It is also where you should make provisions for your children, such as who will be Guardian, if you (and your spouse) die (at the same time). If you (or both you and your spouse) die, leaving behind orphaned children who have not attained the age of majority, anyone who would like custody of the children will have to apply to the court for a custody order. Note that this person may not be someone that you want to raise your children. Any time the court makes a decision with respect to children, the best interests of the children are always considered.
With a Will, your assets are distributed according to your wishes. By having your Will drafted by a lawyer, you are taking control of your life and arranging your affairs in the manner of your choosing. Planning for the future of your loved ones assures that you are preparing for their best interests by taking into account their financial requirements and individual personalities.
Lastly, with or without a Will, your Estate will have to be probated. In Ontario (as opposed to some of the other provinces), probate is tantamount to a death tax. Any assets that are solely in your name at the time of death are subject to Probate fees. Probate fees are $5 on each $1,000.00 for the first $50,000.00 (which equals $250.00) and $15 per $1,000 thereafter. These fees are over and above the legal fees that lawyers charge in administering an estate. Note that if you hold an asset as "joint tenants (with rights of survivorship)", the asset will effectively become owned by the surviving person(s) that you hold the asset jointly with, if they survive you, and accordingly Probate is not payable.
