Do Trust Assets Avoid Probate in British Columbia?

Many people hear that a trust avoids probate and want to know whether that is true. The honest answer is that it depends on which kind of trust it is, when it was created and what property it actually holds.

This article compares the common situations in British Columbia so you can ask better questions before you transfer anything.

This article covers the law of British Columbia.

What probate fees are based on

There is no probate fee if the estate is $25,000 or less. Above that, the fee is $6 per $1,000 (or part) between $25,000 and $50,000, plus $14 per $1,000 (or part) above $50,000. The value of the estate is the gross value of BC property in the Statement of Assets, Liabilities and Distribution.

So the real question is whether an asset belongs in that statement. When a person dies, their estate vests in the personal representative without further declaration or order.

Trusts made during life and trusts made at death

A testamentary trust is generally created on and as a result of an individual's death. Because it comes out of the estate, it does not by itself avoid probate. An inter vivos trust is any trust that is not testamentary, and that includes alter ego and joint partner trusts.

Whether property held in an inter vivos trust stays out of your estate depends on the trust terms and on what was actually transferred into it, so it is worth confirming with a lawyer. An alter ego trust (CRA code 336) is created after 1999 by a settlor aged 65 or older, who must receive all trust income during their lifetime and be the only person who can receive income or capital from the trust during that time. For alter ego and joint partner trusts, the deemed disposition day is the death of the settlor, or the later death of the settlor and spouse or common-law partner, rather than the 21-year anniversary. Whether it works for you depends on the trust terms, what was transferred, and the tax and title consequences, which a lawyer and accountant should review.

Bare trusts and joint ownership

A bare trust is not defined in the Income Tax Act, but a trustee generally qualifies as an agent when it has no significant powers, acts only on the beneficiaries' instructions and only holds legal title. For 2025 year-ends the CRA does not expect bare trusts to file a T3 return with Schedule 15, though certain bare trusts may have to file for years ending in 2026 and later, based on proposed Bill C-15 legislation. Check the current position before relying on that.

Joint tenancy works differently. The land title rules say that when a joint tenant dies, the survivor takes the deceased's interest. Section 162(1) of the Wills, Estates and Succession Act deals with land unless there is a right to land by survivorship, so survivorship property sits outside the estate.

• Land transferred to two or more people is held as tenants in common unless the transfer shows a contrary intention, and there is no survivorship in that case.
• A joint tenant who transfers their interest to themselves severs the joint tenancy, leaving tenants in common with no survivorship.
• If joint owners die within 5 days of each other, or survival is uncertain, special WESA rules apply.
• A gratuitous transfer to an adult child, including adding them to a joint account, is presumed to be held on resulting trust for the parent.

That last point matters. The survivor must prove the parent intended to give them the right of survivorship in the balance, and the judge weighs all the evidence to find the parent's actual intention at the time of the transfer. Dependency of an adult child on the parent can be strong evidence against the presumption.

Trusts and disability benefits

For BC disability assistance, a discretionary trust is not treated as an asset if the client has no way of collapsing it and gaining control of the assets. A non-discretionary trust counts as an asset, and is exempt only where the amount contributed does not exceed $200,000. Check current ministry guidance, since the sources vary.

What to do next

• List each asset and how it is held: your name alone, jointly, or in a trust.
• Work out the likely probate fee using the rates above, so you know what is at stake.
• Ask a lawyer how any trust you are considering would be taxed and registered.
• Do not add a child to an account or title without documenting your intention.
• Review the plan with an accountant before transferring property.

Frequently asked questions