Estate Trustee Duties When the Deceased Held Joint Assets in Ontario

If you are dealing with a deceased person's property, how this applies depends on your role and your situation, so it is worth confirming with a lawyer before you decide what counts as part of the estate. Joint assets cause confusion because they appear in the deceased's records but may not belong to the estate at all.

This article sets out how to sort joint assets, what to investigate, and what to report in Ontario. It is a general guide, and a lawyer can confirm how it applies to your estate.

Start with who actually takes the asset

Property passes to the estate trustee only if no one else has a right to take it by survivorship. Property that passes by survivorship goes directly to the surviving owner, whether or not there is a will. The will does not control it.

For land, the survivor deals with the land registry rather than the court. The survivorship application under the Land Titles Act is a land registry step, not a probate application. Probate is also not always required. A house held in true joint tenancy by a surviving owner can be dealt with without a Certificate of Appointment of Estate Trustee.

Sort each joint asset

Check how title was taken rather than assuming. Land in two or more names, other than land held by executors or trustees, is held as tenants in common unless the document shows on its face that the owners are to take as joint tenants. Spouses and common-law partners hold as joint tenants only if the deed says so. If joint owners all die at the same time, or in circumstances that make it uncertain who survived, they are each deemed to have held as tenants in common unless a contrary intention appears, and each share then passes through that owner's own estate.

Investigate whether a joint asset is really a gift

When an adult child was added to a parent's account or asset without paying, the law presumes a resulting trust. The person who received the transfer must show a gift was intended, and the asset is presumed held in trust for the parent and, on death, for the estate. The presumption of a gift is confined to minor children, and an adult child's financial dependency does not trigger it, though it can be strong evidence against a resulting trust.

Evidence on intent can include the bank documents, control and use of the funds, a power of attorney, the tax treatment of the account, and later evidence if relevant to the intention at the time of transfer. Between spouses, property held in both names as joint tenants is proof, without evidence to the contrary, of an intention to own it jointly, and money on deposit in both names is deemed held jointly.

• Collect account opening documents and signing cards.
• Note who deposited the money and who used it.
• Find any power of attorney and how it was used.
• Look at how the income was reported for tax.
• Record who was added to title, and when.

Reporting, tax and deadlines

For estate administration tax, jointly owned property that passes automatically to the other owner is not counted in the estate's value, but property held in another person's name that belongs to the deceased is. Above $50,000 the tax is $15 for every $1,000 or part of the estate's value. The Estate Information Return must be filed within 180 calendar days after the estate certificate is issued. Amended returns are due within 60 calendar days in the cases set out, for example after newly found assets.

On the final tax return, the deceased is considered to have sold capital property just before death, even if it passes by survivorship. A rollover can apply to a surviving spouse or common-law partner resident in Canada.

Joint assets can also affect claims. A surviving married spouse who elects equalization has property received by survivorship credited against the entitlement, unless a written instrument says it is in addition. The election is due within six months after death, and no distribution may be made within six months of the death. Once notice of a support application is served on you, you generally must not distribute until the court decides, unless everyone entitled to apply consents or the court orders otherwise.

What to do next

• List every asset with how it was held, using land records searched through OnLand where needed.
• Hold off on distributions until the equalization and support periods are understood.
• Note the deadlines for the Estate Information Return and any election.
• Ask a lawyer about any asset where intent is unclear.
• Speak with an accountant about the final return.

Frequently asked questions