Main Purpose of Estate Planning:

The main purpose of estate planning is to "live rich and die poor". To do this, one must rid themselves of all assets and this may require giving up ownership and/or control of your personal assets, i.e. cash, investments, the family cottage, etc.

Objectives:

	Determine who the beneficiaries are of your estate (children, grandchildren, friends, etc.).
	Determine if your estate should be dispersed to beneficiaries at the time of your death or should it carry on in trust.

	Are funds to be kept aside for a specific purpose e.g. grandchild's education?
	Are there any assets you wish to be shared after death such as a family cottage?

Tax Consequences:

	Assets are deemed to have been sold at the time of your death for Fair Market Value.
	Because of "Deemed Disposition Rules" there may be little or no cash to pay the tax liability of the estate and therefore, other (non-liquid) assets may have to be "actually" sold (e.g. the family cottage).
	RRSP's and RRIF's are also deemed disposed of.
	Due to the progressive tax rate structure in the Canadian Income Tax Act, the taxes could be significant.
	Probate fees [think of it as a type of tax] $5 per $1,000 on first $50,000 and $15 per $1,000 thereafter...wow!
	Depending on how your Will is written...there could be PST implications.

Estate Planning Tools:

	Early Inheritance
	Family Trusts
	Family Loans
	RRSP/RRIF Liquidation Plans
	Estate Freeze
	Charitable Bequests
	Change in Asset Title
	Avoid Probate and/or Probate Fees
	Life Insurance Policy for Tax Debt
	Update your Last Will and Testament

For additional information and more details on the above points contact my office at (905) 420-0839 for a booklet on this subject or schedule an appointment with me to explore how the above planning tools can help you to reach your objectives.

Prepared by: Gary F. McLean, CGA