Estate Planning: What Changed in the Last Year & Common Mistakes
Why Annual Updates Matter
An estate plan is not something you prepare once and forget—it’s a living document that should evolve with your life, family, and financial situation. Even if you haven’t experienced major life events, legislative changes, tax rules, or shifts in asset values can affect how your estate will be distributed. Reviewing your plan annually ensures your wishes remain clear, legally sound, and tax-efficient.
Where we stand now
Several developments in the past 12 months make this a smart time to revisit your estate plan. Provincial probate fee adjustments in some jurisdictions could affect the cost of settling estates. Updates to federal tax rules for trusts, especially those involving graduated rate estates, may change how income is taxed after death. In addition, new CRA guidance has clarified reporting requirements for bare trusts, which could impact certain property or joint account arrangements. Even real estate market changes can alter how much of your estate is tied up in a single asset.
Common Mistakes to Avoid
One of the most common mistakes is failing to update beneficiaries on registered accounts such as RRSPs, RRIFs, and TFSAs. Life changes—marriage, divorce, births, or deaths—can leave outdated instructions that conflict with your current wishes. Another oversight is not coordinating your will with other documents like powers of attorney or advanced healthcare directives, leading to gaps in authority if you become incapacitated. And for business owners, not having a clear succession plan can cause unnecessary tax burdens and operational challenges for heirs.
The Role of Asset Titling
How you hold assets—joint tenancy, tenants-in-common, corporate ownership, or trusts—can significantly affect how your estate is settled and taxed. Joint tenancy with right of survivorship allows assets to pass directly to the surviving owner, avoiding probate, but it can also create tax issues or disputes. Tenants-in-common ensures your share follows your will, though it’s usually subject to probate.
Business holdings, investment accounts, and real estate may benefit from specific ownership structures to align with your goals. For example, private corporation shares can offer tax advantages, while trust ownership can provide control and protection. Reviewing asset titles with your lawyer or advisor helps ensure they match your estate plan, minimize taxes, and prevent costly delays.
Digital Assets and Modern Considerations
In today’s world, digital assets—online accounts, cryptocurrency, intellectual property—must be addressed in your estate plan. Without clear instructions, these assets can be lost or inaccessible to heirs. Similarly, if you own property in another country, you may need a secondary will or local legal arrangements to avoid lengthy cross-border probate.
Your next step, set a recurring annual date to review your estate plan with your advisor, lawyer, and accountant. Update beneficiary designations, re-confirm executors and powers of attorney, and review asset valuations. Life changes fast, and your estate plan should keep pace to ensure your legacy is preserved exactly as you intend.
The information provided is for educational/entertainment purposes only. Actual information may vary, please consult our office for further details. Got a question? Feel free to reach us at helpdesk@assentt.com.
