People often assume probate fees will eat significantly into their estate, but in reality they work out to 1.4 or 1.5 per cent of the total estate
Many Canadians may be tempted to minimize probate fees by making their adult children joint owners of a property or an investment account. But experts say it’s a decision that, if not done carefully, can cause more harm than good.
Canadian estate law presumes that if the deceased jointly owned assets with their spouse, they intend for those assets to pass directly to their spouse. But the same presumption does not exist for adult children, Ms. Anderson said. “If anyone has more than one child … they can still do it but they need to make it clear that it is a gift or it isn’t, so everybody understands what’s going on,” she said. “Talk to your kids, don’t let it be a surprise.”
Kirsten Nelms, principal and associate portfolio manager at Leith Wheeler Investment Counsel Ltd. in Vancouver, cautioned that once someone names their child a joint owner of their investment account, they lose control of those assets. Joint ownership requires that both parties sign off on any investment decisions and account withdrawals.
said. If the child’s marriage breaks down, the jointly held assets could also be exposed to equalization unless the child and spouse signed a marriage contract. Ms. Nelms said people are often entering into joint ownership arrangements due to incorrect assumptions about the probate experience.
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