Written by Ron Cooke, President & Founder of Strategic Wealth Protection Partners in Ontario
How Does Probate Work?
Probate is the legal process of validating a will and distributing assets according to a person’s wishes.
However, not all assets must go through probate, and understanding which ones are exempt can help reduce costs and speed up the estate settlement process.
Which assets do not go through probate in Canada?
Certain assets bypass probate automatically, meaning they can be transferred to beneficiaries without legal delays or probate fees.
These include assets held in joint ownership with rights of survivorship, life insurance policies with named beneficiaries, registered accounts like RRSPs, RRIFs, and TFSAs with designated beneficiaries, and assets held in a trust. Planning ahead by structuring assets correctly can save beneficiaries time and money.
What assets are excluded from probate in Ontario?
In Ontario, assets that have designated beneficiaries, such as RRSPs, RRIFs, life insurance policies, and TFSAs, do not go through probate.
Additionally, jointly owned real estate and bank accounts with rights of survivorship are transferred directly to the surviving owner. Private company shares held in a secondary will may also be excluded from probate, offering a valuable estate planning strategy to reduce probate fees.
What assets are not considered part of an estate in Canada?
Assets that do not form part of the estate for probate purposes include jointly owned property with rights of survivorship, life insurance payouts with named beneficiaries, and registered investments with direct beneficiary designations.
Additionally, assets held in a trust are not considered part of the deceased’s estate and are managed according to the terms of the trust, allowing for seamless wealth transfer.
Can an estate be settled without probate in Canada?
Yes, in some cases an estate can be settled without probate.
If the deceased’s assets primarily consist of non-probate assets like jointly owned property, registered accounts with beneficiaries, or trust-held assets, an estate may be settled without probate.
However, if the estate includes real estate or significant financial assets without clear ownership designations, probate may be required. Proper estate planning, such as using trusts or joint ownership, can minimize or eliminate the need for probate.
Which type of ownership would best avoid probate?
Joint ownership with rights of survivorship is one of the most effective ways to avoid probate.
This means that when one owner passes away, the surviving owner automatically assumes full ownership without the need for probate. This applies to jointly owned bank accounts, real estate, and investments, making it a simple yet powerful estate planning tool.
Which types of trusts allow an estate to avoid probate?
Living trusts (also called inter vivos trusts) and alter ego trusts are excellent tools for avoiding probate.
When assets are placed in these trusts, they are no longer considered part of the individual’s estate, allowing them to bypass probate entirely. A properly structured trust ensures a smooth transition of wealth while maintaining control over asset distribution and minimizing tax liabilities.
Avoid Ontario’s Hefty “Death Tax”
While Ontario doesn’t have a direct estate tax on your total net worth, income tax on capital gains and deemed dispositions can have a significant impact on your estate.
These taxes can dramatically reduce the wealth you pass on to your loved ones.
For instance, assets like real estate (excluding your principal residence) and non-registered investments are deemed sold at fair market value upon death. The resulting capital gains are usually taxed at Ontario’s highest marginal tax rate, which exceeds 53.53% (2024).
Here’s an example: If you have an RRSP or RRIF worth $1,000,000, the government could take $535,000 in taxes upon your death.
That’s more than half of your hard-earned savings—gone to taxes, not your family. And that’s before factoring in additional costs like probate fees, executor fees, legal fees, and accounting fees. What will be left for your family?
Did you know that some of your assets may even face double taxation? Without proper planning, the total financial burden on your estate could be staggering.
Simple Steps Can Save You Millions
With our Living Estate Plan, you can not only minimize taxes but also protect and even grow your wealth.
Our proven strategies help shield your assets, ensuring more of your legacy goes to your loved ones—not the government.
Discover How to Minimize Taxes and Secure Your Legacy
Did you know that without a solid estate plan, taxes and fees in Ontario could claim a significant portion of your wealth?
If you’ve worked hard to build your business, investments, and properties, protecting your legacy for your loved ones is critical. At Strategic Wealth Protection Partners, we specialize in helping high-net-worth individuals in Ontario secure their financial futures.
Our Living Estate Plan is designed to:
- Reduce estate taxes and probate fees.
- Simplify wealth transfer to your loved ones.
- Reflect your values and priorities in every detail.
Your Legacy Matters
With our personalized guidance, we’ll help you navigate options like Living Trusts to protect your assets and ensure your family’s peace of mind. Contact us today to book your Living Estate Plan Consultation and take the first step toward a secure future.
Schedule a Living Estate Plan Consultation
Planning your legacy is about more than numbers—it’s about ensuring your family remembers you and your values are honoured for many years to come.
Estate planning and trusts can feel overwhelming, especially if it’s your first time. That’s why we’re here.
With our simple, 5-Step Living Estate Plan, we make the process easy, helping you create a comprehensive estate plan or trust that protects your assets from taxes and probate fees while preserving your legacy. Tools like The Final Word Journal capture your story, wishes, and essential details like accounts and end-of-life plans, ensuring your family has clarity and comfort.
Take the first step today—schedule a consultation call and give your family the ultimate gift: peace of mind and the assurance they were always your priority.
Read More
If you’re starting your estate planning process, you may find these articles helpful:
- Who Pays Probate Fees in Ontario?
- How Much Does an Estate Have to Be Worth to Go to Probate in Ontario?
- Living Trust Ontario Guide: What It Is & Do You Need One?
About the Author
RON COOKE, PRESIDENT & FOUNDER OF STRATEGIC WEALTH PROTECTION PARTNERS
With over 30 years in financial services, I’ve seen the challenges families face when a loved one passes—lost assets, unnecessary taxes, and emotional stress. That’s why I created the Living Estate Plan, a comprehensive process to protect assets, eliminate estate and probate fees, and create legacies that are remembered for many years to come.
This plan ensures your family receives not just your wealth, but a meaningful reminder of your care and love. Tools like The Final Word Journal capture your story, wishes, and essential details, offering clarity and comfort during difficult times.
Your final gift should be more than money—it should be peace of mind, cherished memories, and an organized estate.
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Schedule a 30-minute consultation call with Strategic Wealth Protection Partners.
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