Estate Administration Tax Act in Ontario: What Executors Must Do

If you have been named an estate trustee (often called an executor) in Ontario, you may have heard about the Estate Administration Tax. It is paid as a deposit when the probate application is filed with the court, and the deposit becomes the tax once the certificate of appointment, commonly called probate, is issued. It also comes with filing duties that continue well after the certificate arrives.

This article explains in plain language what you are generally expected to do, which deadlines matter, and what can happen if the rules are missed. Every estate is different, so use it as a map, not as advice for your specific file.

When the tax applies and who bears it

The tax is charged only when an estate certificate is applied for and issued. If no certificate is applied for or issued, no tax is owed. It is paid as a deposit when the probate application is filed, and once the certificate is issued the deposit becomes the tax.

The tax is paid by the estate, not personally by the estate representative. For certificates applied for on or after January 1, 2020, no tax is payable on an estate worth $50,000 or less. Above that, the tax is $15 for every $1,000 (or part of $1,000) of value over $50,000.

Part of your wider role as estate trustee is winding up the deceased's affairs, which includes paying taxes, bills and debts, collecting the assets and distributing what is left to the people entitled to it.

Your main duty: the Estate Information Return

The estate representative must file an Estate Information Return with the Ministry of Finance within 180 calendar days after the estate certificate is issued. This applies even when the estate is worth $50,000 or less and no tax is owed. If the deadline falls on a weekend or holiday, it moves to the next business day.

Filing online is recommended, though the return can also be filed by mail, courier, fax or in person. The Ministry publishes a detailed guide for completing it. Keep the records that support the return for four years at your principal place of business or residence.

Small estates have the same requirement. An Estate Information Return must be filed within 180 calendar days of receiving a Small Estate Certificate, even if the estate is under $50,000.

Some certificates are treated differently. No tax is payable, and no return is required, for a Certificate of Appointment of Succeeding Estate Trustee or a Certificate of Appointment of Estate Trustee During Litigation.

Correcting the return after it is filed

Returns sometimes need to change. The deadlines depend on why.

If more tax turns out to be owing, it can be paid to the Superior Court of Justice or the Ministry of Finance, together with an affidavit setting out the revised value of the estate at the time of death.

Older articles and forms may show different, shorter deadlines. The current guidance uses 180 calendar days for the return and 60 days for amendments, so check that any source you rely on is up to date.

Penalties, reassessment and objections

An estate representative who fails to file the return, or who makes false or misleading statements, may be fined at least $1,000 and up to twice the tax payable by the estate, imprisoned for up to two years, or both.

The Ministry of Finance may assess or reassess an estate's tax within four years after the day the tax was due. If a return was not filed on time or a misrepresentation was made, there is no four-year limit and the Ministry may assess or reassess at any time.

To dispute an assessment, a Notice of Objection must be filed within 180 days from the day the Notice of Assessment was issued. Whether you could be personally affected by unpaid tax is a question that turns on the facts, so confirm it with a lawyer before distributing anything.

What to do next

• Write down the date the certificate is issued and calculate 180 calendar days from it.
• Gather statements, appraisals and other documents that support each asset value.
• Plan to file the return online and keep a copy of everything you submit.
• Set a reminder to review the return if new assets or errors come to light.
• Keep supporting records for at least four years.
• Speak with a lawyer or accountant before distributing the estate if the value or tax is uncertain.

Frequently asked questions