Although individuals are able to appoint an executor who resides in a different province or country, estate administration can be more difficult if the executor is not a resident of the same province as the deceased.
Apart from delays and increased out-of-pocket expenses (e.g. travel and communication expenses), distance can complicate the administration of the estate.
A court only has jurisdiction over the residents of that province. If there’s no Will and a non-resident applies for a court grant under the intestacy, the court has the right to require the individual to post a bond of insurance or personal assets. This is to protect the estate and the beneficiaries of the estate. Certain provinces will not allow a non-resident to apply as administrator of an intestate estate.
Even when executors are named in the Will certain provinces can require a non-resident executor to post a bond of insurance or personal assets.
Depending upon the circumstances of the estate, the court may or may not reduce the amount of the bond or waive the requirement completely. The executor or administrator is permitted to recover the amount he or she pays for the bond from the estate. This can decrease the amount available for the beneficiaries of the estate.
Non-Resident Executors
In addition, there may be tax complications. If the sole executor is not a Canadian resident, then the day after the Will maker’s death, the estate and any resulting trusts are also considered to be non-resident. Any income reportable by the estate after the date of death is subject to withholding tax and the non-resident executor must file the estate and trust returns in his or her country of residence.
An Option to Consider
Regulated national Canadian trust companies can be named as a corporate executor and are authorized to conduct business in all jurisdictions. They’re not required to post a bond in order to conduct estate administration in the province where the deceased was resident.
Although a Will maker may appoint whoever they feel is most appropriate to administer their estate, careful thought should be given to selecting the right executor and trustee. Complications can arise when the executor is not resident in the same province or country as the Will maker.
When appointing an executor, there is a lot to consider, but our team is here to help. Please reach out for personalized guidance.