Back to Home PageWelcome Guest! Register | Login | Home | Contact Us | Site Map | Advertise | FAQ | Search
Canadian Desi
    Articles


        
   Home   Submit Your Article   Success Stories   Search

Similar Articles

Most Common Mistakes
Most Common Mistakes People Make Regarding Life Insurance Life insurance protects against the risk that an insured person will die too soon and be ..
THE BENEFITS OF UNIVERSAL LIFE INSURANCE
Universal life insurance plans have distinct benefits, which set them apart from term, permanent and other life insurance plans. Universal life insura..
The Need For Property Management Services
Property management also known as 3rd party management in Canada has been around for some time now. It can mean different things to different people. ..
Segregated funds
Do you like the feeling of knowing that your money is well protected ? Segregated funds is great choice for investments as it combines the growth p..
Canadian Property Management
Real estate management is a fast growing business in Canada. More and more people are realizing the advantages of handing over property related work t..
Life Insurance: Right Protection = Right Product + Right Amount
Right Protection = Right Product + Right Amount There is no doubt that everyone needs life insurance, but the real question is how much and what ki..
Finding Homes for Sale in Ottawa
Moving out on your own and having a house to call yours is a big step in life, though it is one that many people hope and wish to be able to take. Own..
Income Tax in Canada - Individuals
GET READY FOR YOUR FIRST TAX RETURN AND BENEFITS CLAIM All the persons living in Canada have a statutory obligation to comply with the laws of Ca..
Real Estate Bubble or Perpetual Boom
Tips To Negate The Bust Of The Real Estate Bubble And Make It A Period Of Perpetual Boom Prospective real estate investors are worried about invest..
Buying Real Estate
When it comes to buying Real Estate, proper preparation is one of the keys to success. Don't want to find yourself in a neighborhood you dislike..
Enhance Investment Returns by Maximizing Tax Efficiency
If you’re like many Canadians, you’re already investing outside your RSP. This is a wise investment and tax strategy considering that RSP contribut..
An insight into Buyer Agency
As a new immigrant from other parts of the world including Asia and the Middle East, we are accustomed to paying a real estate agent when buying a hom..
Canadians' Investment Dilemma: The Mortgage Or The RRSP?
It's not hard to figure out where Canadians are spending their investment money these days. Real estate sales have hit record levels for several year..
Buying a Home: What You Can Afford
If you're thinking of purchasing your first home, you probably have a lot of great ideas about what you'd like - such as several thousand square feet ..
First Time Home Buyer Information
Making the right choice when it comes to purchasing a home is a matter of good planning, not good luck. No one person can be expected to know everythi..
Articles Groups
  • Canadian Immigration & Citizenship
  • My Experiences with Canada
  • About Canada
  • Tips for job findings
  • Housing and Mortgages
  • Money Matters
  • Tips for newcomers to Canada
  • RESP & Insurances
  • Education in Canada
  • Miscellaneous
  • Estate Planning


    By chandreshb2001




    Estate Planning

    What is Estate Planning?
    Estate Planning is an integral part of financial planning, which facilitates transferring your family property, tax-efficiently and smoothly to others (your beneficiaries) in accordance of your wishes at your death or later in your life (when you wish to transfer your property).

    An Estate plan if properly executed will:
    -Conserve the value of the estate (minimize income tax)
    -Minimize estate taxes; however minimizing estate taxes should not ‘drive’ the estate plan;
    -Enable a deceased’s assets to be distributed in accordance with their wishes;
    -Preserve the standard of living of the survivors/ dependents

    What is the role of will in estate planning?

    The will is the key element of estate planning. It allows you to achieve above listed goals of estate planning.

    Why do you need a will?

    1. SELF DETERMINATION

    The most obvious reason you should make a will is in order to ensure that, insofar as possible, after death, your property is distributed in accordance with your wishes.

    In the event you do not leave after your death, your property is divided in a statutorily mandated manner, without regard to what your stated wishes might have been during your lifetime.
    2. INCOME TAX BENEFITS

    There are income tax advantages of having a will, especially in the event where you name your spouse as beneficiary. On death, under the Income Tax legislation, there is an immediate deemed disposition of all capital property (i.e. it is as if all capital property were sold and any capital gains realized and taxed on death). However, if you have a will, and your will meets certain criteria, there will be a rollover in favor of your spouse, which means that Capital
    Gains Tax won’t be paid until your spouse’s death. You may also be able to create testamentary trusts for your beneficiary which may provide tax benefits into the future.
    3. MINOR CHILDREN

    In your will, you can name a guardian for your infant children. In the event both parents die, by naming a guardian, a guardian then has the legal capacity to apply for confirmation of this appointment and take over care of the children. In the absence of such a designation, there could be serious confusion around who was to care for minor children, such that the children could either be the subject of a custody battle or, alternatively, could come under the protection of the state. Typically, parents have a very good idea of who they would trust to be the guardian of the children.


    4. TRUST PROVISION FOR CHILDREN

    In a will, one can provide trust provisions for children in the event children are beneficiaries under a Will. For an example, provisions could be made for advances from an estate to cover costs of education and the like. There could also be provisions that children do not inherit until they have attained a certain age, for example 21 or 25.


    5. PROTECTION UNDER EXISTIONG FAMILY LAW LEGISLATION


    You can insert provisions in a Will that would protect your beneficiaries in the event those beneficiaries were involved in marriages that have turned sour. In a Will, you can provide that a beneficiary spouse in the event of a marriage breakdown will not share income earned on an inheritance.

    WHAT CAN HAPPEN IF YOU DIE WITHOUT A WILL

    6. STATUTORY DISTRIBUTION

    In Ontario (as in other Provinces), there is a statutory scheme for distribution of YOUR estate if YOU die without a Will. The rule is that the first $200,000.00 of your estate goes to your husband or wife. Your spouse will receive one-half of the remainder if there is one child and one-third of the reminder if there is more than one child. While on the face of it, this may seem to be appropriate, in many situations, on closer examination, there are some serious drawbacks. If there is, for example, a situation where the home of the parties are living in is in the husband’s name an it is worth $300,000and assuming for the moment it is the only asset of the husband and there is more than one child without a Will the wife would be entitled to $233,333 and
    children entitled for balance. In order to realize this amount, the house would probably have to be sold and the children’s portion, or $66,667, paid to the public trustee and Guardian until the children reach the age of majority. It would no doubt be the intention of the parties, on the husband’s death, that the wife and children would be made homeless. In a Will, this situation could have been provided for.

    7. MINOR’S INTERESTS
    In an estate where you have died without a Will, the public Trustee and Guardian to be kept must manage any interest of a child under the age of 18
    For them until they reach 18 years of age. There is much less scope for contribution towards the children’s expenses during their minority than there typically would be if trust provisions were spelt out in a Will. Obviously, there are the drawbacks of having to deal with the bureaucracy.

    8. THE APPLICATION
    If you die without a Will, since there is no one automatically named as the Executor (the person entitled to take charge of the Estate), chaos can sometimes reign until Letters of Administration are taken out. Before Letters of Administration can be taken out, typically, there is there has to be a search made for any Wills and it is necessary for the Administrator, in most instances, to post a bond which can be substantial expense to the estate. There can also be competing interests as to who is going to be appointed the Administrator. This can make for a far more expensive, by way of legal fees, to die without a will than to die with a Will.




    Chandresh Brahmbhatt MBA
    Financial Planning Consultant
    Investors Group Financial Services Inc
    Chandresh.brahmbhatt@investorsgroup.com

     


    Discuss this article

    Article Rating is 8.6667 (Good).
    Rated by: 3 voters.
    How do you find this article?
    Excellent Good Average Poor Very Poor

    You can also Submit an Article and help other community members. Thanks.



     
    Web
    CanadianDesi
    Please Contribute!
    Write an Article
    Send Community News
    Create Photo and Video Albums
    Submit Good Pictures
    List Useful Websites
    Post Jobs
    Submit Events
    List for FREE!
    Businesses
    Classifieds
    Social Organizations
    Religious Places
    Employment Agencies
    Email Page
    Your Email
    Friend\'s Email

    Advertise Contact Us Privacy Policy and Terms of Usage FAQ
    Canadian Desi
    © 2001 Marg eSolutions


    Site designed, developed and maintained by Marg eSolutions Inc.
    //-->