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  The Companion Advisor: Taxes & Estates
Estate Planning: Being an Executor
What are your responsibilities and obligations?

Being named as an executor of an estate is a big undertaking requiring a considerable amount of time and knowledge. You have been entrusted to handle the financial affairs of the deceased in their absence and owe it to them to make sure you know what is required of you.

Below is a general list of the duties required by you as an executor.

Making arrangements

Locate the Will and read it thoroughly for any special instructions regarding the funeral arrangements.

Assist the family in making funeral arrangements, if necessary.

Preliminary action

Ascertain immediate cash requirements of beneficiaries.

Acquire funeral director's statement of death or apply for provincial death certificate.

Determine location of beneficiaries.

Cancellations and contacts

Terminate lease or arrange for a sublet if deceased lived in a rental property.

Cancel driver's license, magazine and newspaper subscriptions, cable television, club memberships and telephone, and request refunds if applicable.

If applicable, ask Health and Welfare to cancel old age security cheques and Canadian Pension Plan.

Cancel health insurance coverage.

Obtain information on outstanding credit card balances and cancel cards.

Contact Canada Post to reroute deceased's mail, if necessary.

Complete or cancel outstanding broker's orders.

Contact dividend and bond disbursing agents in order to get them to change address of record.

Preparative banking business

Gain access to and list contents of safety deposit box.

Arrange for safe storage of valuable items.

Determine assets and liabilities of deceased by writing to financial institutions, insurance companies, brokers, employer, and RRSP/RRIF trustees for information.

Organize a review of all investments in portfolio.

Open estate bank account.

Benefit Entitlement

Inquire to determine entitlement to and apply for Canada Pension Plan Death Benefits, Survivor's Benefits and Orphan's Benefits.

Contact previous employer to determine any Survivor Pension Benefits or insurance proceeds.

Preliminary Administration

Review tax returns from past years and complete and file any previous outstanding T1 returns

Acquire all title documents for property, mortgages, share certificates, bonds, debentures, and guaranteed investment certificates.

Obtain evaluations of all real estate, securities, automobiles, and any personal property.

Review insurance to determine adequacy of coverage and make changes if deemed necessary.

Ensure that each beneficiary receives a copy of the Will.

Compile a complete list of assets and liabilities, listing them by their class and value. Ensure that you include certificate numbers, registration particulars, maturity dates, interest rates, and payment frequency.

Discuss probate requirements, beneficiary notice, and administrative concerns with a solicitor or estate professional.

Probate concerns

With assistance of a solicitor or estate professional, apply for grant of probate or administration.

After probate has been granted, acquire notarized copies in order to transfer assets.

Request that solicitor or estate professional register probate on title to real estate, if necessary.

Administration matters

Keep in contact with the beneficiaries, reporting on the progress of the estate administration and provide each with a copy of the complete inventory of assets and liabilities.

Organize to have Advertisement to Creditors published before distributing estate assets.

In order to transfer securities, complete all powers of attorney and declarations of transmission.

Administrative Banking

Settle all debt and outstanding claims.

Arrange to have safety deposit box closed and obtain contents.

Complete the closure of all bank accounts, transferring balance to estate account. If joint bank accounts exist with right of survivorship, supply financial institution with death certificate and request that they transfer to surviving joint tenant.

Invest cash surplus according to terms of the Will.

Organize sale of securities if converting to cash. Otherwise arrange for the re-registration and transfer of securities.

Arrange for transfer or rollover of RRSP/RRIF proceeds.

Distribution administration

Examine Will for details regarding the distribution scheme of assets. If necessary, discuss distribution of assets in kind with beneficiaries.

With solicitor or estate professional, review any restrictions or time periods imposed on the distribution of estate assets.

Prepare cheques for debt payments, legacies and interim distributions.

If distribution in kind is required, provide beneficiaries with securities and obtain receipts for them.

Provide beneficiaries with personal effects and obtain receipts for them.

Provide beneficiaries with legacies and obtain receipts for them.

Acquire Goods and Service Tax clearances.

Income tax requirements

If the deceased held foreign assets, complete and file the necessary tax returns.

Complete and file a Terminal T1 Tax Return and any other required returns with Revenue Canada and request a Clearance Certificate. Note that Terminal period returns have to be filed by April 30th of the year following the year of death, or by six months from the date of death, whichever is later.

Complete and file a T3 Trust Information Return. This must be filed within 90 days from the year end of the taxation year chosen for the estate.

Distribution to beneficiaries

Determine if the Will provides for outright distribution. If so, acquire a release for distribution and transfer assets or funds to beneficiaries. Be sure to keep enough funds in a reserve for any outstanding accounts and debts as well as income taxes.

Determine if the Will provides for trusts. If so, arrange for testamentary trusts and organize an ongoing review of investments. Also arrange a review to ensure an ongoing compliance with the rest of the terms of the trust.

Beneficiary approval

Ready accounts for approval or passing by beneficiaries and prepare releases.

When accounting has been completed, write to beneficiaries to request their approval.

Calculate executor's compensation.

Confirm that all releases have been received once account approval has been given by beneficiaries.

After obtaining beneficiary or court approval, take executor's compensation, maintain holdback/reserve pending the receipt of clearance certificates, and distribute and deliver any remaining funds or assets.

Finalizing affairs

If accounts need to be audited by the Court, request that the solicitor or estate professional prepare an application and all necessary notices and make an appointment.

Apply for a tax clearance certificate.

After confirming that all written cheques have cleared, organize the closure of the Estate bank account.

Write a detailed report regarding all aspects of the estate administration and send it to beneficiaries.

- GETTING ADVICE A will requires careful planning to ensure all essential matters are covered. It should also be reviewed periodically and discussed with a qualified adviser or team of advisers to incorporate any changes in your personal circumstances.

Note: This list has been compiled from sources we believe to be reliable and is intended to provide a general informational guide for estate administration. Actual requirements may vary depending on location. This guide should not be construed as income tax or legal advice.

Notice: Fiscal Agents Financial Services Group are not engaged in rendering tax, accounting or legal professional services or advice. The comments in this article are not intended, nor should they be relied upon, to replace specific professional advice. Before acting on material contained herein. Readers should seek advice that is appropriate to their personal circumstances from a professional advisor.

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Article Index


Making arrangements

Preliminary action

Cancellations and contracts

Preparative bank business

Benefit Entitlement

Preliminary Administration

Probate concerns

Administration matters

Administrative Banking

Distribution administration

Income tax requirements

Distributions to beneficiaries

Beneficiary approval

Finalizing Affairs
Companion Advisor
Taxes and Estates
Tax Articles
How does an RRSP save me tax?

What a difference a day makes

RRSP savings through reduced income tax

The more you make, the more you pay!

Compounding your tax refund for a richer future

A dollar is not a dollar

Taxes on Mutual Funds

Mutual Funds - Year end distributions tax tips
Estate Articles
Multiple wills may reduce probate fees

Blind Sided by a Support Claim

Joint Accounts

Estate planning from the Muskoka chair

A matter of trust

Income splitting using testamentary trusts

The RRIF basics



The Money Management Newsletter:
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Taxes and Estate Planning