- Registered plans with a beneficiary designation or declaration are not counted in the estate value used for Ontario's Estate Administration Tax.
- If there is no designation, those plans are included in the estate value.
- The tax applies above the first $50,000 of estate value, at $15 for every $1,000 or part of $1,000.
If someone you love has died and left an RRSP, RRIF or TFSA, you may be wondering whether it has to go through probate and whether it adds to the probate fees. The answer often turns on one piece of paperwork: whether a beneficiary was named on the plan.
This article explains how Ontario treats registered plans when the Estate Administration Tax is calculated, and what changes when no beneficiary was named. It is general information, and an estate lawyer or accountant can confirm how it applies to your situation.
The short answer
Probate is the court procedure that gives someone authority to act as estate trustee, and the Estate Administration Tax is a separate tax paid as a deposit when the application for an estate certificate is filed with the Superior Court of Justice. Registered plans that have a beneficiary designation or beneficiary declaration are not included in the estate value used to work out that tax.
This matters because the tax is based on the estate's value. There is no tax on the first $50,000, and above that it is $15 for every $1,000, or part of $1,000. Leaving a plan out of the estate value means it does not add to the value the tax is worked out on.
Which plans this covers
The exclusion applies to these plans when a beneficiary has been named:
- Registered Pension Plans
- RRSPs
- RRIFs
- TFSAs
The key is a beneficiary designation or beneficiary declaration on the plan itself. A person simply being mentioned as a family member, or a wish expressed in conversation, is not the same thing. The financial institution or plan administrator can tell you whether a designation is on file.
What happens when no beneficiary is named
If there is no beneficiary designation or declaration, these plans are included in the estate value. The tax is based on all assets the deceased owned at the time of death, so the plan's value is then part of the total.
Whether probate is needed at all usually depends on the type of assets. An estate normally must be probated if the deceased owned real property, or assets held by a financial institution, in their own name. Institutions can have their own requirements, so ask each one what it needs from you.
How plans compare with other assets
Registered plans are only one category. This table shows how some common assets are treated for the estate value used in the tax.
| Asset | Counted in estate value? |
|---|---|
| RRSP, RRIF or TFSA with a named beneficiary | No |
| RRSP, RRIF or TFSA with no named beneficiary | Yes |
| Jointly held assets that pass automatically to the other owner | No |
| Real estate outside Ontario | No |
| Canada Pension Plan death benefits | No |
| Insurance paid to the estate | Yes |
Income tax is a separate question from the Estate Administration Tax. How a registered plan is taxed on death is worth raising with an accountant.
What to do next
- Collect recent statements for every registered plan and note which institution holds each one.
- Ask each institution whether a beneficiary designation or declaration is on file, and request written confirmation.
- Gather date-of-death values supported by documents such as account statements.
- If you apply for an estate certificate, remember that the tax is paid as a deposit when the application is filed.
- File the Estate Information Return within 180 calendar days after the certificate is issued, even if the estate value is $0.
- Before distributing the estate, ask about a CRA clearance certificate, because a representative who distributes first can be personally liable for tax debts.
Frequently asked questions
Do TFSAs with a named beneficiary count toward the estate value?
No. A TFSA with a beneficiary designation or declaration is not included in the estate value for the Estate Administration Tax. The same is true of Registered Pension Plans, RRSPs and RRIFs.
What if the plan has no named beneficiary?
The plan is then included in the estate value. The estate pays tax above the first $50,000 of total value, at $15 for every $1,000 or part of $1,000.
Does the executor pay the tax personally?
No. The estate pays the tax, not the estate representative personally. It is paid as a deposit when the application for the certificate is filed.
Do I still file a return if the estate is small?
If an estate certificate is issued, the estate representative must still file an Estate Information Return, even where no tax is payable. The return must be filed even if the estate value is $0.
Sources
- Ontario.ca – Estate Administration Tax — ontario.ca
- Ontario.ca – Apply for probate of an estate — ontario.ca
- Canada.ca (CRA) – Doing taxes for someone who died — canada.ca
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
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