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Estate Planning for those 65+

Estate Planning for those 65+

Life-interest trusts Will, Estate Planning for 65+

When thinking about estate planning, most people think about the usual documents; wills, powers of attorney and representation agreements. However, Canadians over the age of 65 are eligible for two types of life-interest trusts. These trusts essentially act as a substitute for a Will and address some of the disadvantages of having a Will.

Two types of life-interest trusts:

1.Alter ego trust – created for the benefit of the settlor (trust-maker) alone, during his/her lifetime; and
2.Joint spousal trust – very similar to the alter ego trust, except it is created for the benefit of the settlor and the settlor’s spouse, during both of their lifetimes.


  1. Both trusts allow you to avoid the probate process, meaning you avoid paying probate tax;
  2. You can avoid the compulsory estate planning laws and succession schemes (you are able to leave your estate to anyone you want in any proportion);
  3. These trusts cannot be challenged like Wills can under WESA, therefore, allowing you to avoid potential Will variation claims
  4. Asset protection from creditors; and
  5. Avoiding Powers of Attorney.
  6. Beneficiaries can receive their inheritance with less delay
  7. Professional fees are reduced


  1. Tax returns will need to be filed;
  2. Income retained in the Trust will be taxed at the highest marginal rate

Requirements to set one up:

  1. Must be at least 65 years of age to settle and contribute capital property. For joint spousal trusts, both spouses must be over 65.
  2. Must be a Canadian resident
  3. Only the settlor/spouses are entitled to income from the trust during the lifetime of the settlor/spouses.

If you or someone you know is interested in estate planning services, or have any questions, feel free to leave a comment below or reach out and book a consultation.

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