Probate Fees in Ontario: How They're Calculated and How to Reduce Them

Probate fees in Ontario, officially called the Estate Administration Tax, take about 1.5% of most estates. On a $1.5 million estate that is roughly $21,750, paid before anyone inherits a dollar. It is no surprise that “how much will probate cost?” and “can we avoid it?” are among the first questions we hear, from executors and from people planning their own Wills.

This guide explains exactly how the tax is calculated, with worked examples, and then the lawful ways to reduce it. Some are simple and almost always sensible. Others save money on paper and cost far more in family conflict, income tax or lost control, so for each one we explain what it actually saves and where it tends to go wrong.

How much are probate fees in Ontario?

The tax is charged when an estate trustee applies to the court for a Certificate of Appointment of Estate Trustee, the document most people call “probate.” Since January 1, 2020, the rules are:

• No tax on the first $50,000 of the estate’s value.
• $15 for every $1,000, or part of $1,000, above $50,000. That is 1.5% of everything over the first $50,000.

In other words, take the value of the estate, subtract $50,000, round up to the next thousand, and multiply by $15 per thousand. For common estate sizes:

• $50,000 or less: no tax
• $100,000: $750
• $250,000: $3,000
• $500,000: $6,750
• $850,000: $12,000
• $1,000,000: $14,250
• $2,000,000: $29,250

You can run your own numbers with our Estate Administration Tax calculator.

Who pays, and when

The estate pays the tax, not the executor personally, and it is paid up front: The full amount is due when the probate application is filed, not when the estate is wound up. Because the executor usually cannot access the deceased’s accounts until probate is granted, many banks will release funds from the deceased’s account to help pay it.

What counts toward the value

Two details catch people off guard. First, almost nothing can be deducted. Funeral costs, credit card balances, lines of credit and legal fees all reduce what the beneficiaries receive, but not the value the tax is calculated on. The one exception is a mortgage or other registered charge, which is deducted from the value of the Ontario real estate it is secured against. Second, even an estate under $50,000 that owes no tax must still file an Estate Information Return with the Ministry of Finance, within 180 days of the certificate being issued.

Can you avoid probate in Ontario?

You can often shrink the part of the estate that goes through probate. The tax only applies to property that passes under the Will being probated. Several kinds of assets never get there, and many families already have more outside the estate than they realize:

• Property owned jointly with a right of survivorship, such as a home held with a spouse, which passes automatically to the surviving owner.
• RRSPs, RRIFs, TFSAs and pensions with a named beneficiary.
• Life insurance payable to a named beneficiary rather than to the estate.
• Real estate located outside Ontario (it may face probate where it is located instead).

Every strategy below works by moving more value into one of these categories, or by arranging the estate so that part of it does not need a probated Will at all.

Multiple Wills: the most effective tool for business owners

Not every asset needs a court certificate before it can be transferred. Banks and land registries usually insist on probate. A private corporation, on the other hand, can generally transfer its own shares to the people named in a Will on the strength of the Will alone, because the directors control the share register.

Ontario law allows a person to have two Wills that work together:

• A primary Will for assets that will need probate: bank accounts, investment accounts, Ontario real estate.
• A secondary Will for assets that do not: shares and shareholder loans in private corporations, and personal belongings such as art, jewellery and furniture.

Only the primary Will is submitted to the court, so only the assets it covers are counted for the tax. For a business owner whose company is worth $2 million, that difference alone is about $30,000.

The courts have accepted this structure for decades, and the Divisional Court confirmed it again in Milne Estate (2019), after a lower court decision had briefly put it in doubt. It does have to be drafted with care. The two Wills must not revoke each other, the wording must make clear which assets fall under which Will, and the corporation’s own documents should allow the shares to pass without a court certificate. It also pays to look at the corporate side early: If the shares were never properly issued, there is nothing clean to transfer. (Our guide to what to do after you incorporate covers the minute book basics.)

Joint ownership: Simple, but often a trap

Adding someone to the title of your home or your bank account so that it passes to them outside the estate is the most common do-it-yourself strategy. Between spouses it tends to work as intended. With adult children it is where many estate disputes start.

The problem is legal intention. When a parent puts an account or property into joint names with an adult child for no payment, the law presumes the child holds the parent’s share in trust for the estate, unless there is clear evidence that the parent meant it as a gift. This is the rule from the Supreme Court of Canada’s decision in Pecore v. Pecore (2007). If the evidence is unclear, the account can end up back in the estate after all, along with a lawsuit between siblings over what the parent intended. (We explain how these disputes unfold in contesting a will in Ontario.)

Even when the gift is clear, joint ownership with a child has costs that rarely appear on the probate-saving spreadsheet:

• You give up control. A joint owner can withdraw from the account, and you generally cannot sell or mortgage the property without their signature.
• Their problems become your asset’s problems. A child’s creditors, bankruptcy or separation can reach the jointly held property.
• It can create income tax. Adding a child to title on a property that is not your principal residence can be treated as a sale of part of it, triggering capital gains tax now rather than at death.
• It can contradict your Will. An account that passes to one child by survivorship is not shared with the others, even if your Will divides everything equally.

If you do hold assets jointly with a child, write down what you intend, ideally in a signed memorandum prepared with your Will, so that no one has to guess later.

Beneficiary designations on registered plans and insurance

Naming a beneficiary directly on an RRSP, RRIF, TFSA or life insurance policy keeps those funds out of the estate entirely. It is usually the easiest saving available, and it is worth checking every plan you own: an old designation naming “my estate,” or a beneficiary who has since died, quietly brings the money back into the probate calculation.

Two cautions:

• The tax bill may land on the wrong person. When an RRSP or RRIF passes to anyone other than a spouse or certain dependants, the full value is generally taxed as income on your final return. That tax is paid by your estate, while the plan itself goes to the named beneficiary. If the beneficiary of the RRSP is not also the beneficiary of the estate, one person can receive the money while others effectively pay the tax on it.
• It is not out of reach of support claims. Under Ontario’s Succession Law Reform Act, a court deciding a dependant’s support claim can treat designated plans, insurance and joint accounts as if they were part of the estate.

Designations should be coordinated with the Will, not filled out on a bank form years apart from it.

Alter ego and joint partner trusts

If you are 65 or older, you can transfer assets during your lifetime into an alter ego trust (for yourself) or a joint partner trust (for you and your spouse) without triggering capital gains tax on the transfer. You remain the person entitled to the trust’s income and capital while you are alive. After your death, or the death of the surviving spouse, the trust carries on and distributes the assets according to its terms, much like a Will, but because the assets belong to the trust, they are not part of the estate and are not subject to probate.

These trusts can also keep matters private, since a probated Will becomes a court record and a trust does not. The costs are real, though: legal fees to set up the trust, a separate trust tax return every year, and the ongoing work of keeping assets properly registered in the trust’s name. They generally make sense for larger estates, for people who want to avoid probate on real estate or investment accounts that cannot go into a secondary Will, or where privacy matters as much as the tax.

When saving probate fees is not worth it

A 1.5% tax is a real cost, but it is a predictable one. Some of the most expensive estates we see are the ones where a well-meaning plan to save probate fees created confusion about who was supposed to receive what. Before choosing any strategy, it helps to weigh:

• The actual saving. On a $400,000 estate the entire tax is $5,250. A strategy that puts family harmony at risk to save part of that is rarely a good trade.
• Control and flexibility. Assets given away, or placed in joint names, are hard to take back if circumstances change.
• Equality between beneficiaries. Assets that pass outside the Will are not divided by the Will. Plans that look equal on paper often are not.
• Income tax. Probate fees are small next to the capital gains and income tax that some of these strategies can trigger or shift.

The best approach is usually a combination: tidy beneficiary designations, joint ownership with a spouse where it suits the family, a secondary Will for private company shares, and a clear primary Will for everything else.

Plan it with your Will

Probate planning only works when every piece fits together: the Will, the designations on your plans, how your home and accounts are titled, and your company’s records. The best time to look at all of it is when you make or update your Will, and a review every few years keeps it from drifting out of date as accounts are opened and properties change hands.

At Mardini Law, we review your assets and family situation, show you what probate fees your estate would face today, and recommend only the strategies that are worth their cost. We can prepare primary and secondary Wills, coordinate beneficiary designations, and work with your accountant on the tax side. If you have been named as an executor and are dealing with probate now, our guide to probate in Ontario explains the process step by step.