Which assets in Ontario are excluded from probate and the estate administration tax?

Several categories of assets typically pass outside the will and therefore fall outside Ontario's estate administration tax calculation.

Assets held in joint tenancy with right of survivorship — such as a home owned jointly with a spouse — pass automatically to the surviving joint owner and do not form part of the probate estate. Registered accounts like RRSPs, RRIFs, TFSAs, and pension plans that name a beneficiary (other than "estate") also pass directly to that beneficiary. Life insurance with a named beneficiary follows the same rule. Payable-on-death designations on certain bank accounts, where available, work similarly.

Real property located outside Ontario is not subject to Ontario estate administration tax, though it may be subject to probate or similar processes in the jurisdiction where it is located.

Planning your estate to maximize what passes outside the will is a common and legitimate strategy to reduce estate administration tax exposure. However, these structures should be reviewed carefully — joint tenancy, for example, has its own legal and tax implications during your lifetime. An estate lawyer can help you weigh the trade-offs.