Estate Law

Estates Law Tax Implications

The intersection of estates law and tax law is important to consider when administering an estate or ensuring that the distribution of assets is done in a tax-efficient manner.

As such, Milot Law applies its expertise in Canadian taxation and provides legal service in the following areas:

  • Estate administration
  • Estate litigation
  • Tax litigation for Estates
  • Interpretation of wills and trusts
  • Assistance to Estate Executors
  • Tax clearance certificates
  • Certificates of appointment
  • Distributions to non-resident beneficiaries and withholding taxes

Losing a loved one is a difficult and trying time – the added stress of dealing with the deceased’s affairs is not a welcome task. Unfortunately, this task is made harder when the Will left behind is unclear or significant tax issues not previously known to the family arise. In this case, it is absolutely necessary to obtain competent legal advice from a tax lawyer.

Milot Law is regularly retained by estate administrators and beneficiaries of estates that have tax issues to be their Estate Law Tax Lawyers. Executors and beneficiaries of an estate can be held liable under subsection 160(1) of the Income Tax Act (Canada) or section 325 of the Excise Tax Act when making distributions from an estate that has an unpaid tax debt. In this case, the estate trustee should retain a tax lawyer to file an appeal on behalf of the estate to dispute the tax debt.

Estate Administration

In addition, law firms that practice in wills and estates regularly retain Milot Law for advice on complex tax issues that affect the estates for which they act. For example, if a beneficiary of an estate is no longer a resident of Canada for tax purposes when distributions need to be made, the Trustee will have to deal with paragraph 212(1)(c) of the Income Tax Act and determine whether withholding taxes apply. In such cases, mistakes can be very costly – executors and beneficiaries can be held liable for the failure to pay the correct amount of tax.

If you are dealing with an estates issue and need legal advice, please call Milot Law for a free consultation at 416-601-1002.


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