What Happens to a Bank Account When a Person Dies in Alberta?

When someone dies, families often worry about their bank account. Can anyone use it? Can the funeral and other bills be paid from it? What does the bank want to see?

Banks set their own procedures, and how an account was held can change the answer. This article explains the general picture and points out where you should check with the bank or a lawyer.

This article covers the law of Alberta.

Is the account frozen?

In practice, a bank generally restricts a sole account once it learns of the death, and it will want to deal with the person who has authority to act for the estate. The exact timing and steps vary by bank, so ask the bank directly what it needs.

Notifying the bank early is usually sensible. It lets you learn what documents the bank requires and avoids confusion about who may act.

Joint accounts and sole accounts

A sole account is held in the deceased's name alone. A joint account has more than one owner. Whether the money passes to the surviving owner or becomes part of the estate depends on how the account was held and on the intention behind it. This is a point where legal advice is especially useful.

Land works differently, and the contrast can help. A surviving joint tenant can remove the deceased from the land title by filing a Statutory Declaration regarding Proof of Death with a death certificate, with no grant of probate needed. Land owned as a tenant in common or as sole owner passes through the estate.

Paying funeral costs and bills

The estate is responsible for burial and funeral expenses. A personal representative has a duty to satisfy the debts and obligations of the estate, and must act with the care, diligence and skill of a person of ordinary prudence.

A representative is subject to the liabilities and duties of a trustee. If you are not yet formally appointed, keep receipts and be careful about paying other debts or distributing money, and ask the bank and a lawyer what you may do.

What banks may ask for

Requirements differ between banks and depend on the size and type of account. Commonly, banks ask to see documents such as these, but confirm with your bank:

• A death certificate.
• Identification for the person asking to act.
• The will, if there is one.
• Proof of authority to act for the estate, such as a court grant, if the bank requires it.
• Account details and any joint owner information.

For land, if the person owned it as a tenant in common or as sole owner, Land Titles requires an Application for transmission to personal representative with an original filed copy of the Grant of Probate or Letters of Administration from the Surrogate Court of Alberta, and a notarized copy is unacceptable, but a surviving joint tenant needs no grant of probate and can instead file a Statutory Declaration regarding Proof of Death with an original or notarized death certificate. A grant from outside Alberta must be re-sealed by the Surrogate Court of Alberta before Land Titles will accept it. Ask your bank whether it has similar requirements.

Taxes and what to do next

Balances owing to the CRA are paid from estate assets, and the legal representative is responsible for making sure the deceased's taxes are filed. The CRA recommends paying balances before the estate is distributed. Income earned after death is reported on a T3 trust return, and income from January 1 of the year of death up to the date of death goes on the final return.

Distributing without a clearance certificate makes the representative personally liable for unpaid amounts, up to the value of the assets distributed.

• Get several certified copies of the death certificate.
• Find out whether each account was joint or sole.
• Call each bank and ask what it requires.
• Keep funeral receipts and records of every payment.
• Do not distribute funds until debts and taxes are addressed.
• Speak with a lawyer or accountant if the situation is unclear.

Frequently asked questions