Following an announcement by the provincial government this past February, on April 1, 2021 Ontario's new procedure to administer small estates came into effect. The new procedures, which are designed to ease the administration process on "Small Estates" are welcomed and should facilitate a cost effective and timely probate on modest estates.
Under The Smarter and Stronger Justice Act,1 amendments were made to The Estates Act2, one of which was the introduction of the "Small Estate." A Small Estate is an estate with a value of $150,000 or less. The new and simpler procedures for Small Estate administration include the following:
- completing the new and simpler application forms;3
- in some instances, removing the requirement of the applicant to provide certain supporting documents (such as an affidavit of service for the notice of application); and
- in most circumstances, removing the requirement to post a bond.4
Estate administration tax is still payable on Small Estates. As with all estates, the first $50,000 is exempt from estate administration tax, and the remainder is taxed at approximately 1.5% of the value of the estate as of the date of death. Once probate has been issued, estate trustees are required to file the Estate Information Return with the Ministry of Finance within 180 days of the issuance of probate.
Regardless of the amount of money held in an account, banks and other financial institutions often cannot take instructions from an estate trustee unless probate has been granted. By easing the administration requirements on Small Estates, the hope is that less people will leave these estates unsettled due to the burdens and costs associated with probate.
We understand that dealing with a loved one's estate can be overwhelming. If you have questions regarding Ontario's new procedures for the administration of Small Estates, or any questions regarding wills and estates in general please contact Esther Abecassis, wills and estates lawyer at Devry Smith Frank LLP at email@example.com or 416-446-3310.
"This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs."
1 Smarter and Stronger Justice Act, 2020, S.O. 2020, c. 11 – Bill 161.
2 Estates Act, R.S.O. 1990, c. E.21.
3 the following new forms have been introduced pursuant to the Rules of Civil Procedure (R.R.O. 1990, Reg. 194: Rules of Civil Procedure under Courts of Justice Act, R.S.O. 1990, c. C.43) Form 74.1A – Application for a Small Estate Certificate (the "Application"); Form 74.1B – Request to File an Application for a Small Estate Certificate or an Amended Estate Certificate; Form 74.1C – Small Estate Certificate (the "Certificate"); Form 74.1D – Registrar's Notice to Applicant in an Application for a Small Estate Certificate or Amended Small Estate Certificate; Form 74.1E – Application to Amend Small Estate Certificate; and Form 74.1F – Amended Small Estate Certificate (the "Amended Certificate")
4 New section 36(3) of the Estates Act provides that "subject to section 6, a bond shall not be required in respect of a small estate, unless, (a) a beneficiary of the estate is a minor; or (b) a beneficiary of the estate is incapable within the meaning of section 6 of the Substitute Decisions Act, 1992 in respect of an issue in the proceeding, whether or not the person has a guardian."
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.