So Do I Really Need a Will?

January 15, 2022 | Craig Dale, CPA, CA, CFP, TEP


A majority of Canadians do not have a Will and are letting the government determine how to allocate their wealth when they die.

Welcome back to the blog!

In addition to working with clients on investment and wealth management, I write a blog on tax tips and tidbits and share other articles that I think will be of interest.

In this edition, I’m going to write about the importance of having a Will, an important topic given everyone’s favourite two certainties in life, death and taxes!

Now in spite of the importance of having a Will, it is surprising that the majority of Canadians do not have one - it is almost as if individuals think they can schedule estate planning like an oil change. A lack of planning unfortunately has the ability to destroy a tremendous amount of wealth that could have been preserved, while also resulting in an outcome that likely differs from an individual’s preferred intentions.

Okay, so what really happens if I don’t have a Will?

If an individual dies without a Will, they are considered to have died intestate and someone must be appointed by the court to administer the estate.

In British Columbia, the Wills Estates and Succession Act (“WESA”) outlines a priority order in terms of who can apply for the grant of administration, starting with a spouse.

The application involves a lot of paperwork, affidavits, and requires a cheque for the probate fees and typically takes a few months and the assistance of a lawyer.

Most assets require a grant of administration to deal with, which can make it challenging to pay for probate fees, funeral costs, and other estate expenses while the application is being reviewed by the probate registry.

Once a grant of administration is issued, the administrator can proceed with the next steps in administering an estate.

So everything will go to my spouse, right?

A common misconception is that if an individual dies without a Will, all assets will simply transfer to a surviving spouse. In the event that there are assets that are owned jointly with a right of survivorship, this will be the case.

Similarly, investment assets or life insurance with a designated beneficiary will transfer to that individual designated. These assets will not form part of the estate and therefore are not subject to probate and the related cost.

However, what about everything else?

In B.C., WESA governs how the assets are to be distributed, so in essence, the family business or investment accounts get lumped together with the golf clubs and the barbecue and are allocated with the laws of intestacy as follows…

If a person dies leaving a spouse and no children, it is generally quite simple, as everything passes to the spouse, however, the probate process still applies, meaning there is added time and cost involved that could have been avoided.

Interestingly, it is actually possible to have more than one spouse at death where the individual is married but separated and living in a new common law relationship. If this is the case, then WESA sets out that both spouse’s share the estate equally.

Fortunately, where all assets transfer to a surviving spouse, there are no income tax consequences as there is a tax deferred rollover that applies, meaning the assets transfer at their cost, so unrealized gains are not triggered

If a person dies leaving a spouse and children, it starts to get a little more complex, as the spouse is entitled to the first $300,000 of the estate. Then one half of the balance goes to the spouse with the other half divided amongst the children.

If the children are not also the deceased’s children, then the spouse is only entitled to the first $150,000 with the balance allocated as indicated above.

It might still seem simple enough, however, if the estate includes a home in the name of the deceased, the spousal home may satisfy in whole or in part the spouse’s interest.

However, what if the home value exceeds the value of the surviving spouse’s interest?

The surviving spouse may have to purchase the remaining interest from the estate.

So you can start to see how this is less than optimal, right?

It gets worse, as the assets that transfer to a child unfortunately do not transfer at cost, and as such, they are subject to a deemed disposition at fair market value, potentially triggering a significant income tax liability prematurely.

If a person dies with no spouse and has children, the estate is divided amongst the children equally, which seems simple, but what if the children are minors? In this case, the Public Guardian and Trustee may have to hold the assets for their benefit.

Alternatively, what if the children are adults but one is a spendthrift or has a substance abuse problem? Well, they inherit their portion outright and can use it as they see fit - no strings attached.

If a person dies and has no spouse or children, the estate goes to the parents, and if they are not alive, it is divided amongst any brothers and sisters equally.

In the above circumstances, not only do the laws of intestacy dictate how the assets are distributed, there is no discretion in terms of which assets are allocated where.

It is inevitable that the distribution will take more time, involve additional cost, and most likely trigger adverse tax consequences.

In conclusion, although Canadians have often struggled to talk about finances, hopefully the importance is evident from the above.

If you need assistance with estate planning or a referral to a lawyer that can assist, please feel free to reach out.

I can be reached at or 604.981.6681.

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