What is Probate? 

Probate is the procedure by which an application is made to Court to have the will of a deceased validated. The court upon review of the application and will of the deceased will confirm the appointment of the person(s) named as executor. The Court then issues the executor the "letters probate" (Grant of Probate), as proof of their authority to deal with the deceased's estate. 

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How do you know if you need a Grant of Probate?

The Grant of Probate provides official recognition of the authority of the executor over the deceased's estate. This authority may be necessary to prove in order transfer certain assets in accordance with the instructions in the Will or collect money owing to the estate. It may also be necessary to obtain a Grant of Probate where an executorship may be contested by another party. 

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What are Probate Fees (Estate Taxes) and how are they Calculated?

Probate fees are a tax payable to government to obtain the Grant of Probate. They are calculated based on the value of the estate. In British Columbia, the fee to commence a probate application is $200, however this fee is waived if the entire value of the estate does not exceed $25,000. The probate fees are calculated as follows:

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$6 for each $1,000 or part of $1,000 of the value of the estate in excess of $25,000, up to $50,000; plus

$14 for each $1,000 or part of $1,000 of the value of the estate in excess of $50,000. 

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For example: Estate taxes on an estate worth $500,000 would be $6,450   First $25,000 = Free | Second $25,000 = $6 x 25 = $150 | Remainder ($450,000) = $14 x 450 = $6,300 | Total  =  $6,450 

 

Do you Still Need to apply for Probate when a Person dies without a Will?

If someone passes away without leaving a will, someone will need to apply to the Probate Court to appoint them to act as an "Administrator" of the estate. The Court will not just appoint someone on their own, an application for a "Grant of Administration" must be submitted in a similar manner as an application for a Grant of Probate. Usually a member of the family or close friend of the deceased will apply to be the Administrator of the estate. The Grant of Administration is required before the Administrator can begin distributing the estate. The process of appointing an Administrator, rather than an executor, can take longer, be more complicated and more expensive.   

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How can you reduce your estate taxes?

One of the most central reasons for creating an estate plan is to figure out ways you can minimize your estate taxes. Although each person's circumstances are unique, there are always several things a person can do during their lifetime to minimize the amount of taxes their estate will pay. It's important to learn about what these are from an early stage so that you are prepared in the event of a sudden loss.