How Much Can an Estate Trustee Be Paid in Ontario?

If you are an executor, or estate trustee, you may be doing a lot of unpaid-looking work: collecting assets, paying bills, dealing with the family and keeping records. It is natural to ask whether you can be paid for it, and how much.

If you are a beneficiary, you may be looking at a number the trustee has taken and wondering whether it is reasonable. This article explains the general rule in Ontario, how the amount is reviewed, and what steps usually make the process smoother for everyone.

What the law says about estate trustee pay

Under the Trustee Act, a trustee, guardian or personal representative is entitled to a fair and reasonable allowance for their care, pains, trouble and time, as allowed by a judge. That wording covers executors and estate trustees.

The key words are fair and reasonable. The Act does not set out a fixed percentage of the estate or a fee table. You may hear people mention a rule of thumb percentage. That is not a number found in the statute, so it is best treated as a starting point for discussion rather than a right.

Serving as an estate trustee is also a choice. A person named in a will does not have to act, and if they decline, the beneficiaries may nominate someone else.

What makes an amount reasonable

Because the test is fair and reasonable, the focus is on the care, effort and time the trustee actually put in. A simple estate with one bank account is a very different job from one with a house to sell, a business to wind up and unhappy relatives.

Questions that commonly come up when compensation is reviewed include:

• How complicated was the estate, and how long did the work take?
• How much time did the trustee personally spend, and on what tasks?
• Were there records showing what was done and why?
• Did the trustee hire professionals for work that would otherwise have been theirs to do?

A judge makes the final call on what is allowed. Good records are the best support for any amount claimed.

How compensation gets reviewed

Many families agree on compensation informally. Where they do not, the court can step in. On a passing of accounts, the judge may fix compensation if it was not already fixed.

A trustee does not have to account to a court except by inventory, unless a person interested in the estate or a creditor requires it. An interested person may also move for an order requiring the estate trustee to pass accounts.

On a passing of accounts the judge may inquire into the whole of the deceased's property and its administration, and may hear complaints of misconduct, neglect or default that caused loss. That means the court looks at the full picture, not only the pay.

Pay is not the only money question

Compensation is separate from the trustee's other duties. The estate is distributed only after funeral and burial expenses and debts are paid. If the assets cannot cover all debts, they are paid proportionately, with no kind of debt taking priority over another.

If a trustee's conduct is the real concern, a different remedy may apply. The Superior Court of Justice may remove a personal representative on any ground that would justify removing another trustee. Where trustees cannot agree, any person with a financial interest may apply or move for directions.

What to do next

Whether you are the trustee or a beneficiary, a few practical steps reduce conflict.

• Trustees: keep a dated log of time spent and tasks done, along with receipts and statements.
• Trustees: talk to the beneficiaries about compensation before taking any, and put any agreement in writing.
• Beneficiaries: ask for a clear account of what has been done and what has been taken.
• Everyone: get legal advice before paying yourself, objecting or starting a court step, because the right approach depends on the will and the facts.

Frequently asked questions