This is part eleven of the series on moving an elderly parent into your home. By now you have the multigenerational household running, the power of attorney signed, and maybe home care sorted. The one thing most families never get to is the will – because talking about a parent’s death while they are sitting at your kitchen table feels ghoulish. But the will, the executor you will probably become, and the tax at death are exactly what fall on you when the time comes.
I understand the reluctance. I also understand what happens when you skip it: the parent dies, and the person who has to clean up the legal and tax mess is almost always you. So this post is not the general how-to. We have a full wills and estate planning guide for the mechanics. This one is narrower and more useful for our situation: how to make sure your parent’s estate is actually in order, what you are signing up for as their executor, and what the tax bill at death really looks like in Ontario.
Why a Parent Moving In Changes the Estate Conversation
When your parent had their own house, their estate was simple to picture: the house, a bank account, maybe an RRIF. Once they move in with you, the picture scrambles.
The house may have been sold to fund the move (selling a parent’s home for care covers that decision), which converts an illiquid, tax-sheltered asset into cash and investments that behave very differently at death. Their money may now be flowing through your household. You may have added them to your title or your bank account “to keep things simple.” Every one of those moves has an estate consequence, and none of them is obvious until someone dies and a lawyer starts asking questions.
The move is exactly the right moment to fix the paperwork, because you are already having hard conversations about money, care, and living arrangements. The will is the natural next one.
Does Your Parent Actually Have a Will?
Start here, because a surprising number of people over 75 either have no will or have one drafted decades ago that names a dead spouse as executor and leaves everything to a bank branch that no longer exists.
An out-of-date will can be worse than none at all. In Ontario, dying without a will (intestate) triggers a rigid statutory formula for who inherits and in what shares – and it may not match what your parent wants, especially in a blended family. If your parent remarried, note that Ontario changed the rules so that marriage no longer automatically revokes an existing will (that changed in January 2022), but divorce and separation still affect gifts to an ex-spouse. If the will predates a major life event, it needs a fresh look.
The Will and the Power of Attorney Are Not the Same Document
This trips up almost everyone. A power of attorney operates while your parent is alive but incapable. A will operates only after death. The POA dies the instant your parent does – your authority to sign for them evaporates, and the will’s executor takes over. If your parent has one but not the other, they are only half covered. You want both, drafted together, ideally by the same lawyer so they do not contradict each other.
The Executor Problem (You Are Probably It)
If your parent moved in with you, you are the odds-on favourite to be named estate trustee – the Ontario term for executor. It sounds like an honour. It is closer to a part-time unpaid job with personal legal liability.
What the Executor Actually Signs Up For
The executor locates and secures assets, files the deceased’s final tax return (and possibly estate returns), applies for probate if needed, pays the debts and taxes, and distributes what is left. You are personally liable if you distribute the estate before clearing the Canada Revenue Agency – which is why smart executors get a clearance certificate from CRA before paying out the last dollar. Get that sequence wrong and beneficiaries can come after you personally for the shortfall.
Two practical asks while your parent is alive: make sure you know where the original will is stored (the court wants the original, not a photocopy), and get a written list of accounts, institutions, insurance policies, and passwords. Hunting for a stray RRIF at an institution nobody remembered is how estates drag on for two years.
Executor Compensation in Ontario
Ontario has no fixed statutory fee, but courts apply a guideline of roughly 5% of the estate (commonly split as 2.5% on capital and 2.5% on revenue), adjusted for the actual work and complexity. It is taxable income to you, whereas an inheritance is not – so if you are the sole beneficiary anyway, many executors waive the fee. Worth deciding in advance, not in grief.
Probate in Ontario: the Estate Administration Tax
Probate is the court process that confirms the will is valid and gives the executor legal authority to act. In Ontario it comes with the Estate Administration Tax, universally called probate fees.
The Numbers
Ontario charges nothing on the first $50,000 of the estate, then $15 per $1,000 – a flat 1.5% – on everything above that (verify at publish; the exemption and rate have held since January 1, 2020 but are policy figures). A $500,000 estate pays about $6,750. A $1 million estate pays roughly $14,250. It is not the crushing “death tax” some promoters make it out to be, but it is real money, and it is paid from the estate before beneficiaries see a cent.
You also have a filing obligation: the estate trustee must file an Estate Information Return with the Ontario Ministry of Finance within 180 days of the estate certificate being issued (verify at publish). Miss it and there are penalties.
What Gets Probated and What Skips It
This is where planning actually saves money. Probate applies to assets that pass through the will. Assets that pass outside the will are generally not counted:
- Registered accounts (RRSP, RRIF, TFSA) with a named beneficiary
- Life insurance with a named beneficiary
- Property held in joint tenancy with right of survivorship
So a parent whose main assets are a beneficiary-designated RRIF and a jointly held account may face a tiny probate bill or none. The catch is that avoiding probate is not free – some of these workarounds create bigger tax or legal problems than the fee they save. Which brings us to the traps.
Tax at Death: the Deemed Disposition
Canada has no inheritance tax. What it has instead is a deemed disposition: at the moment of death, CRA treats your parent as having sold everything they owned at fair market value. Any accrued capital gain becomes taxable on the final (“terminal”) return. This is the single biggest number most families never see coming.
The capital gains inclusion rate is 50% for 2026 – meaning half the gain is added to income and taxed at your parent’s marginal rate (verify at publish). The proposed increase to 66.67% was cancelled in March 2025 and never became law, but given how many times that figure moved, confirm the current rate before you model anything. In Ontario the top combined marginal rate is around 53.53% (verify at publish), so the effective tax on a large capital gain tops out near 27%.
The Principal Residence Question
If your parent still owned a home, the principal residence exemption usually wipes out the gain on it entirely. But once they have moved in with you, watch two things. First, if they sold their home to fund the move, that shelter is spent – the proceeds are now taxable investments. Second, if you put your parent on the title of your home, their share is not automatically their principal residence, and it can complicate your own exemption, since one household can only designate one property per year. Before adding a parent to your title, talk to an accountant. This is not a do-it-yourself decision.
RRSP and RRIF: the Terminal Return Time Bomb
Here is the one that ruins estates. An RRSP or RRIF is not capital property – at death, its full fair market value collapses into income on the terminal return, taxed as ordinary income. A parent with a $400,000 RRIF and no surviving spouse can generate a six-figure tax bill in the year they die.
There is one major escape hatch: if a qualifying survivor – a spouse or common-law partner, or a financially dependent child or grandchild – is named as beneficiary, the account can roll over tax-deferred. For most parents living with an adult child, there is no spouse to roll to, so the full amount is taxable. Plan for it. Do not let the estate distribute the cash and then discover CRA is owed $120,000.
TFSA
Cleaner. A TFSA is not taxed on the value up to the date of death. A spouse named as “successor holder” keeps it sheltered; anyone else receives the date-of-death value tax-free, with growth after that date becoming taxable. Confirm the beneficiary designation is current.
The Joint-Ownership Trap
The most common piece of kitchen-table estate planning is adding an adult child to the parent’s house title or bank account to “avoid probate.” It sounds clever and it is frequently a mistake.
Under a well-known Supreme Court of Canada line of cases, a gratuitous transfer from a parent to an adult child carries a legal presumption of a resulting trust – the law assumes the child holds the asset in trust for the parent’s estate, not as a true gift, unless there is clear evidence the parent intended a gift. That means the “joint” account may get pulled back into the estate anyway, probate saving evaporates, and siblings end up litigating over what your parent meant. Adding a child to real estate can also trigger a partial deemed disposition and expose the asset to the child’s creditors or divorce.
If your parent’s goal is to move money to you or to a low-income sibling, do it deliberately – our guide on moving money to a low-income parent without wrecking their GIS walks through the benefit interactions. Do not improvise it through a joint account.
The Sibling Landmine
If you took your parent in, you likely also absorbed the cost – the benefit trade-offs, the renovation, the daily care. Siblings who did none of that often still expect an equal split of whatever is left. A will that is silent on this is a lawsuit waiting to happen.
The fix is to make the intent explicit while your parent is competent: a documented, dated statement of wishes, ideally references in the will itself, and a frank family conversation. If your parent wants to recognize your contribution, that has to be written down by them, not asserted by you after the fact. An estate lawyer can also help wall this off against a dependant’s-relief claim.
What I’d Actually Do
- Confirm the will exists and is current – this week. Not “someday.” Find the original, read who the executor and beneficiaries are, and check whether it predates a move, remarriage, or death in the family. An old will pointing at dead people is a problem you can fix now and cannot fix later.
- Get the will and the power of attorney done together, by a lawyer. For a straightforward estate this is a few hundred dollars. It is the cheapest insurance you will ever buy against a multi-year probate fight.
- Build the asset map before you need it. A single page listing every account, institution, insurance policy, and beneficiary designation. Verify the beneficiary designations on the RRIF, TFSA, and any insurance are current and name a real person, not “estate.”
- Model the terminal-return tax now. If your parent has a large RRIF and no spouse, the death-year tax bill can swallow a big share of the estate. Know the number so nobody distributes cash that CRA is owed.
- Do not add your parent to your title or accounts to dodge probate. The resulting-trust presumption, the capital gains exposure, and the creditor risk usually cost more than the 1.5% you were trying to save. If probate planning matters, have a lawyer structure it properly.
- Decide the executor fee and the sibling question in advance. Put the intent in writing while your parent is competent. Grief is the worst possible time to discover the family disagrees about money.
- As executor, get the CRA clearance certificate before the final distribution. Distribute early and you are personally on the hook for any tax that turns up later.
This post is part of an ongoing series on moving elderly parents into your home. It reflects my own reading and decisions and is not legal, tax, or financial advice. Estate law and tax rules change, provincial rules differ, and every family’s situation is specific – figures cited here are current as of publication and flagged for re-verification where they shift annually. Before acting, consult a licensed Ontario estate lawyer and a qualified tax professional.