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Will Preparation & Estate Planning
Kashif Ahmed– Real Stories from Financial Planners
Do you know how to prepare a will?
Have you made your will, yet?
Do you know the requirements of a will creation?
Will preparation could be an overwhelming task considering the rules and requirements that need to be obeyed accordingly. Nonetheless, planning ahead with respect to your personal affairs (will creation or estate planning) can save problems and expenses for your family in the future.
Not sure where to start? Continue to read this newsletter and let us guide you through the process of will preparation, validation, and the planning of your estates.
What Is A Will?
A will is a legal document that states how someone wants their estate to be divided after they pass away. Their estates include what they own (assets) and what they owe (liabilities).
Why do we create a will? Preparing a will helps protect your assets and your family; it lets the court know what to do with your estate after your death. A will often needs to go through probate, which is a process that ensures the will is real and was left by the deceased person.
Will usually names an executor or administrator (can be one person or several people) who is responsible for carrying out the instructions in the will. You may name a person who is close to you such as a family member or a friend as an estate representative. You can also name a financial professional as your estate representative. It is always recommended that you talk to your estate representative to ensure they’re comfortable with their role and responsibilities.
What Are The Requirements For A Will To Be Valid In Canada?
When creating a will, some criteria should be followed to ensure its validity. Each province has slightly different laws that must be obeyed. However, below is a general list that needs to be followed:
- The will must be written in a physical form (on paper, rather than in digital format).
- The person writing the will must be over the age of majority and must be of a sound mind.
- If the will is in typed format (not handwritten), there needs to be two witnesses who must see the will owner signing the will, and then sign their names in each other’s presence.
- In either kind of will, your signature must be at the very end of the will.
It is important to note that a person who is beneficiary under the will, or their spouse, must not be a witness, as this would make the bequest to that beneficiary void.
Are You Obligated To Create A Will? What Happens When You Decide Not To Create One?
You are not legally required to make a will. However, if you die without a will, your property will be divided accordingly to B.C.’s law (or in accordance with your province). You will also be giving up the right to appoint the guardian of your choice for any children in your care.
In other cases, when there is not a will left by the deceased, certain individuals are eligible to apply for a grant of administration in order to handle the estate. If successful, the person who is named as administrator is legally able to distribute the estate. If not, the law decides who will manage your estate and who will get it. Consequently, your estate may not go where you want it to. Therefore, preparing a will is always highly recommended.
Do You Need A Lawyer To Write A Will?
You don’t need a lawyer to write a will. However, it is a good idea to obtain professional legal help when you make your will. This will help you make sure all your documents are prepared and witnessed properly.
Estate Planning and Estate Representative
Estate planning means arranging how you will leave your money and property after death, and what you intend to leave your spouse, children or others.
Part of estate planning is assigning an estate representative that will administrates your estate. Those administrators are primarily responsible for settling debts and liabilities and dealing with assets of the deceased in accordance with the will. If there is no estate representative or no will, then the responsibility of handing your estate settlement will be determined based on provincial or territorial law.
Responsibilities Of an Estate Representative
As estate representative, you are responsible for carrying out the instructions written in the will. These responsibilities may include:
- Making funeral and burial arrangements
Locating the deceased’s final will
- Getting an appraisal for the value of the estate
- Paying estate fees
- Paying all debts owing by the deceased
- Applying to have the will validated by a court (probate)
- Providing financial information about the estate to the beneficiaries
- Dividing the estate as outlined in the will (or legislation, if there is no will)
- Completing a final tax return for the deceased, as well as any returns required for the estate
- Locating and notifying all beneficiaries named in the will, or under the law if there is no will
- Putting a notice out for creditors notifying them that the person has died
- Making funeral and burial arrangements
Does Living On Or Off Reserve Matter For Estates?
Indigenous Services Canada (ISC) is responsible for estate services in all provinces. Meanwhile, Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC) is responsible for estate services in the Yukon and Northwest Territories.
Under the Indian Act, the Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC) is only involved with estates for people “ordinarily resident” on a reserve.
“Ordinarily resident” on a reserve means that an eligible First Nations person usually lives on a reserve and does not maintain a primary residence off a reserve. They may, however, temporarily live off a reserve for education purposes or to obtain care or services not available on a reserve.
How Are The Estates Of People Who Have Died On Reserve Managed?
SC or CIRNAC is required to manage estates of people who were or could have been, registered under the act and usually lived on a reserve. As part of estate services, ISC or CIRNAC:
- Appoints estate executors or administrators
- Approves wills so they can take effect
- Transfers reserve lands from the estate to the beneficiary or the heirs
- Determines the heirs of a person dies without a will
- Serves as administrators if no one is willing or able to settle the estate
- If serving as an administrator, distributes estate assets according to the will or the provisions of the Indian Act when there is no will
What You Can Do When Someone In The Family Passes Away?
Handling the affairs of someone who died can be very different from one person to another. The following checklist helps you determine who to notify, points you in the right direction, and keep you organized:
- Register the death,
- Get a death certificate,
- Cancel a Canadian passport,
- Cancel a citizenship certificate or permanent resident Card,
- Cancel driver’s license, BCID, and/or BC service card,
- And more…
For the full checklist, please click here
Preparing a will ensures that a person’s wishes of how they want their estates to be distributed is going to be met. Educating yourself about will preparation and estate planning is an important part of planning for your family’s future. You can use a kit to write your own will, and its’ always a good idea to get help from a lawyer or notary public to review your will and ensure it is valid.