An Estate Information Return (“Return”) is now mandatory in Ontario. Basically, the Return is a form which must be completed by the estate trustee (ie executor) when an application for a certificate (commonly referred to as letters probate) is made. It has to be filed by the estate trustee within 90 days after the certificate is issued by the Court.
Thankfully, there were no other changes which affect a number of estate planning techniques such as multiple wills etc.
We should not be under any illusions about the reason behind the Return requirement. It is all about money. The Government wants to make sure that estate trustees are paying the proper amount of estate administration tax. The rate remains .5% up to $50,000 and then 1.5% thereafter. The rate is not a high percentage but it adds up when you include real estate, bank accounts, RRSPs, investments and etc.
The Return and a Guide to complete the Return are available on the Ontario Government’s website at http://www.fin.gov.on.ca/en/tax/eat/
The information required includes:
1. Real estate. Fair market value of the property at the date of death, municipal address, value of encumbrances (ie mortgages etc.), assessment roll numbers, Property Identification Numbers (ie PINs) and etc. The estate trustee will need some help from the Estate’s lawyer to get this information. The completion of the Return can be delegated to the lawyer but it is important to note that it is the legal responsibility of the estate trustee to file it.
2. Cash and investments. A description of the asset including the number of units held and account number and etc.
3. Other assets. For vehicles, a vehicle identification number (“VIN”) and for boats, a hull identification number (“HIN”).
Jointly owned assets are excluded provided it is a true joint asset (not just transferred for convenience purposes). The estate trustee is required to certify that the information in the Return is correct. Failure to do so can result in fines and even, imprisonment. It remains to be seen how aggressive the Ministry will be in enforcement.