As if your job as Executor were not onerous enough, as of January 1, 2015 the Government of Ontario is throwing a few more bricks in your basket.
Under the former scheme, the Executor when applying for Probate would be required to set out in an affidavit (under oath and subject to severe penalty for perjury) the value of the estate for Estate Administration Tax (“Probate Fee”) purposes. Now, however within 90 days the Executor will also be required to complete and file a painfully detailed Estate Information Return to the Minister of Finance for Ontario.
In the Return, the Minister requires a detailed list of assets with a full description (eg. VIN number, legal description of real estate, etc.), investment account numbers, adviser’s name and contact information, number and classes of investments, etc., etc.
Lest you feel inclined to ignore filing the Return, or simply insert your “best guess” as to values, the Act makes it a punishable offense to fail to file or to file with “false or misleading” information. It is also an offense to “assist” someone to do so. The penalty is not less than $1000.00 and not more than double the tax and/or two years in jail.
Unlike most other tax schemes, there is no Clearance Certificate available. This means that you can never get this monkey off your back – the Province can come back after the Executor for up to four years in any event, and forever if the Province alleges fraud or “carelessness”, whatever that may mean.
Being and Executor was never fun. Now it has even become dangerous. For those brave enough now to take on the job, we recommend as a minimum that you seek professional advice, that you have a solid basis for your numbers (including valuations where appropriate) and that you buy executor’s insurance.
Low Murchison Radnoff (with permission)