Can a tax treaty reduce the withholding tax owed when a non-resident beneficiary receives an Ontario inheritance?

Potentially, yes - Canada has tax treaties with many countries that can affect how certain cross-border payments and dispositions are taxed, and depending on the beneficiary's country of residence and the type of asset involved, a treaty may reduce or otherwise affect the withholding that would apply under Canadian domestic tax rules alone. Whether a treaty actually helps in a given case depends heavily on the specific treaty's terms and the nature of what's being transferred, so this isn't something that can be assumed to apply generally.

This is a genuinely technical area of federal cross-border tax law, sitting outside Ontario estate law entirely, and it interacts with concepts like the "section 116" clearance process for non-residents disposing of taxable Canadian property. Getting the treaty analysis wrong, or missing that one applies, can mean either overpaying unnecessarily or under-withholding and creating a personal liability problem for the estate trustee.

Because treaty relief typically has to be claimed or applied for correctly, rather than happening automatically, an estate trustee dealing with a non-resident beneficiary from a treaty country should raise this specifically with a cross-border tax advisor before finalizing any withholding or distribution, rather than assuming the default domestic rules are the final word.