A will typically names an estate executor who will be responsible to carry out the wishes of the testator’s will. The executor could be a single individual or multiple. Depending on the complexity of the estate, it can also be a trust company. The estate executor duties can be simple or complicated, depending on the size of the estate. It’s important that the executor is someone who has financial acumen and the willingness to be part of the estate settlement process as it could take time and resources.
Some of the tasks that the executor would be responsible for but not limited to:
- Completing applicable forms related to probate
- Probate is the legal process where the will has to go through provincial courts in order to get certified and validated. The process involves fees and the fees vary from province to province. In Ontario, effective January 1st 2020, the probate fees are $15 for every $1,000 which is applied only to estates with a value of $50,000 and above.
- Detailing the financial assets of the estate
- The executor would be responsible to prepare a list of asset and liabilities and their value at the time of death. This could include cash, investments, real estate properties, jewelry and other valuables.
- Settling and debts outstanding with creditors and the Canadian government
- The executor must pay the debts of the deceased before any proceeds are paid out to the beneficiaries. If failing to do so, the executor may be held personally responsible.
- Distributing the assets of the deceased as directed in the will
- The executor would be responsible for opening a bank account in the name of the estate and effectively distribute the assets of the estate to the stated beneficiaries in the will.
- Filing the personal and estate income tax returns.
- The executor would be responsible to file income tax returns for the deceased in the in the year of death. If the death occurred between January 1st and October 31st, tax return is due on April 30th. If the death occurred between November 1st to December 31st, the tax returns are due within six months after date of death.
Estate Executor Compensation
As the job of settling an estate is demanding and may require hours of work, estate executors are entitled to compensation. Depending on your relationship to the deceased, your compensation may either be a fixed or a variable rate determined by the size of the estate, your responsibility, time spent and your skill level. Any compensation you would earn as an executor would be considered taxable income.
