- The Trustee Act entitles an estate trustee to a fair and reasonable allowance for care, pains, trouble and time, as allowed by a judge.
- Percentage figures you hear about are rules of thumb, not the statute, and the fixed scales in the regulations apply to attorneys and guardians, not executors.
- Taking fees early without agreement, court approval or will authority can mean repaying the difference.
If you are an executor, or a beneficiary wondering what an executor may charge, you have probably heard a percentage quoted. People often talk about a rule of thumb based on the value of the estate. It helps to know where such figures sit in the law before you rely on them.
This article explains the legal test Ontario uses, why percentages are guides rather than fixed rules, and the traps around paying yourself early. The exact percentages courts have used come from case law, so confirm them with a lawyer before you rely on any number.
The legal test: a fair and reasonable allowance
Under the Trustee Act, an estate trustee is entitled to a fair and reasonable allowance for the care, pains, trouble and time spent on the estate, as allowed by a judge of the Superior Court of Justice.
The amount of compensation may be settled even if the estate is not before the court in an action. When accounts are passed, the judge may from time to time allow a fair and reasonable allowance for the care, pains, trouble and time spent.
Notice what the statute does not do. It does not set a percentage. Fair and reasonable is a judgment about the work actually done, which is why two estates of similar size can produce different results.
Why percentages are guides, not rules
Percentages of estate value are a practical shortcut that people use to estimate compensation. Because the statute only requires a fair and reasonable allowance, any percentage is a starting point for discussion, not a guaranteed entitlement. A simple estate may justify less than a rule of thumb suggests, and a difficult one may justify more. The specific percentages courts have used come from case law and are worth confirming with a lawyer.
Do not confuse these guides with the fixed scales found elsewhere in Ontario law. Those scales apply to different roles:
| Role | How payment is set |
|---|---|
| Estate trustee (executor) | Fair and reasonable allowance allowed by a judge |
| Attorney under a continuing power of attorney for property | Prescribed scale: 3% on receipts, 3% on disbursements and three-fifths of 1% of the annual average asset value |
| Public Guardian and Trustee (estate administration) | 3% per transaction and 0.60% of the annual value of the assets managed |
The prescribed scale under the Substitute Decisions Act, 1992 is for a guardian of property or attorney, who may take annual compensation in accordance with it. It is not the rule for executors.
When the amount is set differently
- The will fixes the allowance. Section 61 of the Trustee Act does not apply where the will or other instrument creating the trust fixes the allowance.
- The trustee is a lawyer. Where a barrister or solicitor is a trustee and provides necessary professional services, the allowance may be increased to reflect those services.
- The beneficiaries agree or the court approves. These routes matter when a trustee wants to be paid before accounts are passed, as the next section explains.
Paying yourself early (pre-taking)
The Court of Appeal for Ontario has held that an estate trustee may take compensation before passing accounts only with the agreement of all persons with a vested or contingent interest who are sui juris, with court approval, or where the will provides for it.
The risk is real. If a trustee takes compensation early and the court later approves a lower amount on a passing of accounts, the court can approve the reduced compensation and order the difference repaid to the estate.
There is also no statutory requirement to pass accounts at fixed intervals, and estate trustees may choose not to unless the court compels them to. A beneficiary who has a financial interest can move for an order requiring the estate trustee to pass accounts.
What to do next
Whichever side of the table you are on, good records make compensation easier to justify or review. The accounts filed with court must include a statement of the compensation claimed. Estate trustees must keep accurate records of the assets and transactions in the estate.
- Read the will for any clause that fixes or addresses compensation.
- Keep a log of the time spent and the tasks done on the estate.
- Do not pay yourself before you have the agreement of all interested adults, court approval, or clear authority in the will.
- Beneficiaries should ask for a clear explanation of any amount claimed before agreeing to it.
- Remember that fees are taxable to the person who receives them; see our article on taxation of executor fees.
- Get legal advice before agreeing to a percentage or if there is disagreement.
Frequently asked questions
Is there a fixed percentage an executor can charge in Ontario?
The statute does not set one. It provides for a fair and reasonable allowance for care, pains, trouble and time spent, as allowed by a judge. Percentage figures you hear about are guides drawn from case law, so confirm them with a lawyer.
Does the 3% scale for attorneys apply to executors?
No. The prescribed scale of 3% on receipts, 3% on disbursements and three-fifths of 1% of asset value applies to attorneys under a continuing power of attorney for property. It does not govern executor compensation, which turns on a fair and reasonable allowance.
Can an executor be paid before the estate is finished?
Only in limited cases: with the agreement of all persons with a vested or contingent interest who are sui juris (legally capable adults), with court approval, or where the will provides for it. If the court later allows less, the difference can be ordered repaid.
What if the will says what the executor gets?
Section 61 of the Trustee Act does not apply where the will fixes the allowance. The will's amount then governs, subject to whatever the facts and a lawyer's review show.
Sources
- Trustee Act, R.S.O. 1990, c. T.23, s. 61(1) (e-Laws) — Ontario e-Laws
- Wall v. Shaw, 2018 ONCA 929 — ontariocourts.ca
- Ontario.ca – Ontario Public Guardian and Trustee fees — ontario.ca
- O. Reg. 26/95 (Substitute Decisions Act, 1992), s. 1 — Ontario e-Laws
- Substitute Decisions Act, 1992, s. 40(1) — Ontario e-Laws
- Rules of Civil Procedure, R.R.O. 1990, Reg. 194, r. 74.17(1) — Ontario e-Laws
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
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