Planning for the distribution of your assets after you pass away is a critical part of estate planning. A properly drafted will can ensure that your wishes are carried out, and your loved ones are provided for. However, wills and estates law in British Columbia (BC) is a complex area of law. It is essential to understand the laws governing wills and estates in BC to ensure that your estate plan meets your wishes and that your loved ones are adequately provided for after your passing. Working with Origin Law Group can provide the guidance and expertise you need to create a plan that meets your needs.
Here are some of the ways Origin Law Group can help you:
Drafting a Will
We can help you draft a will that reflects your wishes and is legally valid. We can provide guidance on how to divide your assets, how to appoint an executor, and how to create trusts for minor beneficiaries or individuals with special needs.
We can help you create a comprehensive estate plan that includes more than just a will. We can advise you on how to minimize estate taxes, how to transfer assets to beneficiaries, and how to designate guardians for minor children, and how to create a tax effective family trust. We can also assist with the creation of powers of attorney and representation agreements, which provide legal authority for individuals to make financial or medical decisions on your behalf if you are unable to do so.
When creating an estate plan, it is important to consider the tax implications of your decisions. In Canada, there are several taxation issues that can arise in relation to wills and estates. Understanding these issues can help you make informed decisions and minimize your tax obligations.
Estate Administration Tax
Estate administration tax, also known as probate fees, is a tax that is levied on the value of an estate when the executor applies for probate. The tax rate varies by province, but it can be up to 1.5% of the value of the estate. In some provinces, there are exemptions for small estates or for estates passing to a surviving spouse.
Capital Gains Tax
Capital gains tax is a tax on the increase in value of an asset when it is sold or transferred. In the context of estates, capital gains tax can be an issue if the estate includes assets that have increased in value since they were acquired. When these assets are transferred to the beneficiaries, the estate may be subject to capital gains tax. However, there are several strategies that can be used to minimize or defer this tax, such as using the capital gains exemption or transferring assets to a spousal trust.
Estate Income Tax
Estate income tax is a tax on the income earned by an estate during the administration process. This tax is separate from the personal income tax that may be owed by the deceased individual. The estate income tax rate is the same as the personal income tax rate, and it is payable by the estate.
Registered Retirement Savings Plans (RRSPs) and Registered Retirement Income Funds (RRIFs) are popular vehicles for saving for retirement. However, these assets can create tax issues for estates. When an RRSP or RRIF holder dies, the funds are typically included in the estate and taxed as income. However, there are strategies that can be used to minimize or defer this tax, such as designating a spouse as the beneficiary or transferring the funds to a qualifying beneficiary.
After someone passes away, the process of administering their estate can be complex and time-consuming. We can help the executor of an estate navigate this process by providing guidance on the legal requirements, including obtaining probate, preparing tax returns, and distributing assets to beneficiaries. We can also provide representation in case of disputes between beneficiaries or creditors.
Ensure All WESA Considerations Have Been Made
The Wills, Estates and Succession Act (WESA) is a law that governs how the estates of deceased individuals are handled. It was introduced in 2014 to replace several outdated estate laws and simplify the estate administration process. If you are a resident of British Columbia, it is important to understand how WESA affects you and your estate.
Who Does WESA Apply to?
WESA applies to anyone who is a resident of British Columbia or has assets located in the province. It also applies to estates of individuals who passed away in British Columbia. If you are a resident of British Columbia, it is important to ensure that your estate plan is in compliance with WESA.
What Does WESA Cover?
WESA covers a wide range of issues related to estates, including:
Wills: WESA governs the creation, revocation, and interpretation of wills. It sets out the requirements for a valid will, including the age and mental capacity of the testator, the signing and witnessing of the will, and the revocation of a will.
Intestacy: If a person dies without a will, WESA sets out the rules for intestacy. This means that the deceased’s assets will be distributed according to a set formula that takes into account the surviving spouse, children, parents, and other relatives.
Estate Administration: WESA sets out the process for administering an estate, including the appointment of an executor or administrator, the distribution of assets, and the payment of debts and taxes.
Trusts: WESA governs the creation and administration of trusts, including the appointment of trustees and the distribution of trust assets.
Disputes: If there is a dispute over an estate, WESA sets out the process for resolving the dispute, including mediation and court proceedings.
Working with Origin Law Group to create a will and estate plan can provide numerous benefits and safeguards for you and your loved ones. By leveraging the knowledge and experience of our professionals and partners, you can ensure that your wishes are properly documented and legally binding. Additionally, Origin Law Group can help you navigate complex legal processes, reduce the likelihood of disputes or challenges, and provide peace of mind for you and your family. Overall, the investment in a quality estate plan can provide a lifetime of benefits and protection, making it a necessary decision for anyone seeking to secure their legacy and protect their loved ones.