New year, new regulations – Changes to the Estate Administration Tax Act
We have previously blogged about the proposed changes which had been announced for the Estate Administration Tax Act. While it was widely believed that the previously circulated draft would eventually become law, uncertainty still existed surrounding the proposed changes, most notable of which being when the new regulations would become effective.
The uncertainties surrounding the proposed changes to the Estate Administration Tax Act have now been answered, for on December 22, 2014 the regulation giving effect to the proposed changes was officially filed. A copy of the regulation, as filed, can be found here.
The most notable question that has now been answered is that the regulation became effective of January 1, 2015. As January 1, 2015 has now passed, as of writing this blog the regulation is now in full force and effect, and all new applicants for a Certificate of Appointment of Estate Trustee must now abide by the new requirements.
While the regulation makes several changes to the process of applying for a Certificate of Appointment of Estate Trustee, from my perspective the most notable of which is section 3 of the regulation, which provides that the Estate Trustee must within 90 days of the issuance of a Certificate of Appointment of Estate Trustee file a return setting out certain information regarding the estate. The information contained in this return includes detailed information regarding the assets of the estate, including a breakdown of all bank accounts held by the Deceased. As section 5.1(4) of the Estate Administration Tax Act provides that the penalty for any person who files a false or misleading statement may include a fine not exceeding twice the amount of tax payable by the estate, or to imprisonment for a term of up to two years, Estate Trustees must be careful to ensure that they are in compliance with the new regulations.
Thank you for reading.