Tag: Estate Administration Act
Were you recently appointed as Estate Trustee and needed to obtain a Certificate of Appointment of Estate Trustee (otherwise known as “probate”)? In that case, you need to know that an Estate Information Return must be filed with the Ministry of Finance within 90 days of the date of the appointment, setting out the assets in the Estate and their corresponding date of death values.
Typically when an Application for Certificate of Appointment is filed with the Court, a trustee may not have access to every asset of the Estate such that that the value of the Estate may not necessarily be accurate.
As a result, when an Estate Information Return is filed following the Certificate of Appointment being granted, all of the assets of the Estate must be listed. Depending on the values of the assets as confirmed by the trustee following the Certificate of Appointment being granted, a refund may be issued in the event that Estate Administration Tax was overpaid or additional tax may be payable in the event that the value of the assets as listed on the Application is lower than what was listed on the Estate Information Return.
The Estate Information Return may be audited by the Ministry of Finance for up to four years after it is filed. As such, it is important to retain all relevant records in the event of such an eventuality. Another important consideration is that the Ministry of Finance will not typically provide confirmation of receipt of an Estate Information Return so it is prudent to send it via means that would provide you with confirmation of delivery such as fax.
Finally, if a trustee finds out any additional information regarding the value of the assets of the Estate that has any bearing on the Estate Administration Tax payable, an amended Estate Information Return must be filed within 30 days of the new information being uncovered.
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The transfer of real property is one issue that often arises in estate matters. However, it is when real property has not been transferred to entitled beneficiaries within three years of the date of death of the owner of the property that the beneficiaries may require the assistance from an estate lawyer to have the property transferred to him or her.
Section 9(1) of the Estates Administration Act (the “ETA”) provides that real property not disposed of, conveyed to, divided or distributed among the persons beneficially entitled to it within three years after the death of the deceased shall vest in the persons beneficially entitled to the property. Simply put, if an estate trustee does not deal with real property owned by an estate within three years of the date of death then the real property will vest in the beneficiaries of the estate or in those who the testator specifically gifted the real property to in his or her Last Will and Testament.
While vesting can occur automatically where the deceased died intestate, that is not the case where the deceased died leaving a Will. Where the deceased died testate, Section 10 of the ETA provides:
- Nothing in section 9 derogates from any right possessed by an executor or administrator with the will annexed under a will or under the Trustee Act or from any right possessed by a trustee under a will.
A review of the case law on this issue suggests that where an estate trustee has the implied or express power to sell or convert real property at such times and in such manner as he or she sees fit, section 10 of the ETA will prevail and render section 9 of the ETA inoperative. However, consideration must be given to whether the deceased intended for the estate trustee named in their Will to have the authority to deal with the real property beyond the three year limit set out in the ETA.
Accordingly, when considering whether to seek a vesting order on behalf of a beneficiary, it is important to review the terms of the testator’s Will to determine what authority was granted to the named estate trustee with respect to real property and whether the testator had any specific intentions regarding the estate trustee’s discretion to delay the exercise of such authority.
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