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What Happens When You Die Without a Will?

What happens if you don't have a willPin A 1993 survey by the Trust Companies Association of Canada found that only half of all Canadians 18 years of age and older have a valid will. This means that half of all Canadians are at risk of dying intestate or without a will. Intestate also refers to the individual who dies without a will. Some of the common reasons and misconceptions that keep people from preparing wills are as follows:

  • they feel that they are too young
  • they believe that all of their assets will go to their spouse anyway
  • they do not feel they have sufficient assets worth worrying about
  • they believe that the government will fairly distribute their assets

Which Reason is Yours?

Chances are if your reading this, you don’t have a will. Imagine if you died tomorrow, what would happen? Contrary to the belief of many people, in most cases, the entire estate does not transfer automatically to a spouse upon death, and the fact is, many people do die at a relatively early age. Very few people realize that they may be negotiating with the Public Trustee, who will be acting on behalf of their minor children, when it comes to determining what they will get from the estate of their late spouse.

Distribution of an Estate Without a Will

The legislation of many provinces makes reference to the “issue” of the deceased. Issue includes all of your descendants (i.e., children, grandchildren, great-grandchildren, etc.), including those born within or outside of marriage, and those who are legally adopted. In most provinces, it also includes those children conceived, but not yet born at the time of their parent’s death. If you were not survived by a spouse or any decedents, the provincial legislation dictates how your estate would be distributed to other relatives, such as parents, siblings, nieces and nephews. Estate planners and estate lawyers recommend that everyone over the age of 18 should have a valid will. This is especially so because of the potential for adverse tax consequences. Canada does not have an inheritance tax, wealth tax, or a gift tax. It does, however, have a capital gains tax, which arises on disposition of assets. In other words, disposition is a “triggering event”. Death is also a triggering event. This is all the more reason that a will could make use of elections and planning to minimize the incidence of tax. Anyone with any assets should prepare a will because, while it is true that each provincial government has a scheme for distributing an intestacy, that scheme might be far removed from the wishes of the deceased. A person does not need to own much in the way of assets to benefit by having a will in place. For example, someone who would like to pass on “my mother’s engagement ring” or the “vase I got from Aunt Matilda” could easily use a will with good result. Furthermore, the existence of a will usually expedites the distribution of the estate, minimizing the strain on the survivors in their time of grief. Intestacies usually take far longer to settle. Also, it usually costs more to administer an intestacy and the additional legal fees in an intestacy are likely to be far more than the cost of preparing a will in the first place.

Why Make a Will?

By preparing a will, the testator or testatrix has the opportunity to control how his or her property is disposed of after death. If he or she dies intestate (i.e., without a valid will), provincial legislation dictates how his or her property will be distributed. By preparing a will, the testator or testatrix also has the opportunity to name the personal representative of his or her estate. This individual (often also referred to as the executor or executrix or trustee) will be responsible for carrying out the directions of the will. It is the responsibility of the executor or executrix to gather all of the assets of the deceased, pay any lawful debts, and then distribute the assets to the lawful beneficiaries. Presumably, the testator or testatrix will choose someone whom he or she trusts and whom he or she believes will administer the estate of the testator or testatrix in a manner that best reflects his or her wishes. If the testator or testatrix dies intestate, the province will appoint an administrator for his or her estate. While the province often appoints a family member, this may not be the person that he or she would have liked to have administering his or her final affairs.


Photo credit: lassi.kurkijarvi / Foter / Creative Commons Attribution-NonCommercial 2.0 Generic (CC BY-NC 2.0)

Andrew W Bradley
Andrew W Bradleyhttp://andrewwbradley.ca
Andrew is a licensed Life Insurance Broker and Registered Retirement Consultant-RRC® helping Ottawa families since 2011. Awards : 2017 ThreeBestRated.ca -Handpicked Top 3 Financial Services in Ottawa, 2017 Faces Magazine Awards – Ottawa’s Favorite Financial Advisor, 2017 Feedspot Top 40 Life Insurance Blogs on the web and 2016 Insurance Business Magazine – Life & Health Advisor of the Year Finalist.

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  1. This made a very interesting read, thank you for posting this. As you might have guessed I’ve not made a will, mainly because I’m not sure what to put in it. I do want all 7 of my children to share everything but do I include grandchildren? Trouble is you see that some of my kids have children themselves but 3 of them don’t. I don’t want future grandchildren to go out empty either so perhaps it should just be divided it out between my children.

  2. This is one of the most helpful things I have read recently. This issue is on our minds lately, due to the passing of some close relatives.

  3. We put off doing wills for longer than we should but then realized we were doing the wrong thing by doing so, happy to say that wills are now done!

  4. Ours aren’t done yet, but I the this is the kick in the pants we needed to make sure things go the way we need them to. Thanks for keeping it simple.

  5. This made a very interesting read, thank you so much for posting,never really thought about it but I guess we should make one real soon


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