Probate is commonly required for assets owned solely by the deceased. Assets that legally pass outside the estate through a valid right of survivorship or beneficiary designation may not require probate. However, the treatment depends on the asset’s legal and beneficial ownership, location, beneficiary designation and the requirements of the organization holding it.
This guide explains which Ontario estate assets commonly require probate and which may pass outside the estate.
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Probate is commonly required where an estate trustee cannot collect, transfer or sell an asset without presenting a Certificate of Appointment of Estate Trustee. Assets that frequently require probate include:
An asset may form part of the deceased’s estate even where a probate certificate is not ultimately required to deal with it. The requirements of each bank, investment institution, land registry office or other asset holder should be confirmed before commencing the probate application.
Certain assets may pass directly to another person without becoming part of the probate estate. These may include:
Joint ownership or a beneficiary designation does not automatically determine whether an asset falls outside the estate. The ownership documents, account terms, beneficiary designation and surrounding circumstances should be reviewed before excluding an asset from the probate application.
Joint ownership does not always avoid probate. The result depends on the form of ownership, the right of survivorship and the deceased’s beneficial interest.
Real estate held as joint tenants generally passes to the surviving owner. Probate may not be required, although a Survivorship Application is usually needed to update title.
The deceased’s share does not pass automatically to the other owner. It normally forms part of the estate and may require probate before transfer or sale.
The names on an account do not necessarily determine ownership. The deceased’s intention and beneficial ownership must be reviewed, particularly where an adult child was added for convenience.
| Important: Jointly owned assets should be reviewed ideally by a probate lawyer before they are excluded from the probate estate. |
A valid beneficiary designation may allow an asset to pass directly to the beneficiary without probate. The designation and account documents should always be confirmed.
Registered Accounts
RRSPs, RRIFs and TFSAs may pass outside the estate where a valid beneficiary or successor-holder designation applies. If the estate is named, or no valid designation exists, the account may form part of the probate estate.
Life Insurance
Life insurance proceeds generally pass outside probate when payable to a validly designated beneficiary. If the proceeds are payable to the estate, they ordinarily form part of the probate estate.
Pensions and Death Benefits
Pension and employment-related death benefits may be paid directly to a surviving spouse or named beneficiary. The applicable pension plan and beneficiary designation determine how the benefit is paid.
Important: An asset passing outside probate is not necessarily exempt from income tax. Separate tax liabilities may arise upon death.
Ontario real estate owned solely by the deceased will generally require probate before it can be transferred or sold. However, limited exceptions may apply.
Solely Owned Property
A Certificate of Appointment is ordinarily required to establish the estate trustee’s authority to transfer or sell Ontario real estate registered solely in the deceased’s name.
First Dealings Exemption
Certain properties converted from the Registry system to Land Titles may qualify for the First Dealings exemption. This may permit a transfer without obtaining probate.
Title Review Required
Eligibility depends on the parcel register, title history and proposed transaction. A real estate lawyer should review title before determining whether the exemption is available.
Important: If probate is obtained for other estate assets, the value of First Dealings property may still need to be included when calculating Estate Administration Tax.
Foreign assets require careful review because their treatment depends on the type of asset, the deceased’s residence and the probate certificate being requested.
Bank accounts situated outside Canada may need to be included in the value of an Ontario estate. The foreign financial institution may also require additional local documentation.
Foreign stocks, investment accounts and business interests may form part of the Ontario probate estate and must generally be valued as of the date of death.
Real estate located outside Ontario is not included when calculating Ontario Estate Administration Tax. However, a separate probate or estate process may be required where the property is located.
Important: Cross-border estates may involve additional probate, tax, translation and document-authentication requirements.
Most debts cannot be deducted when calculating the value of an estate for Ontario Estate Administration Tax.
Mortgages and Liens
The amount owing on a mortgage, collateral mortgage or lien registered against Ontario real estate may generally be deducted from the deceased’s interest in that property.
Loans Against Other Assets
Loans secured against vehicles, investments or other personal property generally cannot be deducted from the value of those assets for probate purposes.
Unsecured Debts
Credit cards, personal loans, student loans, funeral expenses and other unsecured liabilities are not deducted when calculating the estate’s value.
Important: These debts may still be payable by the estate even though they cannot be deducted when calculating Estate Administration Tax.
Business interests owned by the deceased may form part of the estate and require probate. These assets may include shares of a private corporation, shareholder loans, partnership interests and the assets of a sole proprietorship.
Whether a Certificate of Appointment is required depends on the nature of the business interest, the corporation’s governing documents and whether another person or institution requires proof of the estate trustee’s authority.
In some estate plans, private company shares are governed by a properly drafted secondary Will. If those assets can be administered without obtaining probate for that Will, their value may not be included in the estate covered by the probated primary Will. This planning must be completed before death and requires careful coordination between the Wills and the corporate records.
Where the deceased owned business interests, the estate trustee should review the Will, shareholder agreement, minute book and financial records before determining whether probate is required. Learn more about how to avoid probate in Ontario.
Dying without a Will does not automatically make every asset subject to probate. The same ownership rules generally apply: assets held solely in the deceased’s name may require a Certificate of Appointment of Estate Trustee Without a Will, while assets passing through a valid right of survivorship or beneficiary designation may pass outside the estate.
Solely owned Ontario real estate, bank accounts, investments, vehicles, personal property and business interests may require probate, depending on the asset and the requirements of the institution holding it. The estate will be distributed according to Ontario’s intestacy laws. Learn more about the probate process in Ontario.
Does every estate require probate?
No. Probate is generally required only where an estate trustee needs court-confirmed authority to collect, transfer or sell an estate asset.
Does having a Will avoid probate?
No. A Will identifies the intended estate trustee and beneficiaries, but probate may still be required depending on the assets and the requirements of the organizations holding them.
Are joint bank accounts excluded from probate?
Not automatically. The result depends on the right of survivorship, beneficial ownership and the deceased’s intention when the account was made joint.
Does a jointly owned home require probate?
Property held as joint tenants may pass to the surviving owner without probate. The deceased’s interest in property held as tenants in common normally forms part of the estate.
Do RRSPs, RRIFs, TFSAs and life insurance require probate?
They may pass outside probate where a valid beneficiary or successor-holder designation applies. If the estate is named or no valid designation exists, the proceeds may form part of the probate estate.
Can the deceased’s debts reduce the probate value?
Generally, only qualifying encumbrances registered against Ontario real estate may be deducted. Credit cards, personal loans and debts secured against other assets ordinarily cannot be deducted when calculating Estate Administration Tax.
Is a principal residence subject to probate in Ontario?
A principal residence may require probate when it was owned solely by the deceased or when the deceased held a share as a tenant in common. If an estate certificate is obtained, the Ontario property’s date-of-death value is generally included when calculating Estate Administration Tax, less any mortgage or other encumbrance registered against the property.
The principal residence exemption applies to capital gains tax; it does not create an exemption from probate or Estate Administration Tax. A residence held in joint tenancy may pass to the surviving joint owner, although the ownership arrangement and beneficial ownership must be reviewed.
Are assets held in a trust subject to probate in Ontario?
Assets validly transferred to an inter vivos trust before death generally do not form part of the deceased’s estate and may pass without probate. However, merely describing an asset as trust property is insufficient. The trust must have been properly established and the asset legally transferred to it. If the deceased retained beneficial ownership or the transfer was incomplete, the asset may remain part of the estate.
Is the CPP death benefit subject to probate in Ontario?
The Canada Pension Plan death benefit may be paid to the deceased’s estate or, in certain circumstances, to another eligible person. However, the CPP death benefit is not included when calculating the value of the estate for Ontario Estate Administration Tax. Receiving the benefit through the estate does not, by itself, make it subject to probate tax.