Well the simple answer is no, but…There are tax implications when you pass away. So to try to make this simple, when anyone passes away all the assets are deemed sold by the CRA. The only way around this is that it will roll over to the spouse or common-law partner, but what about the kids? The assets like your house, RRSP’s, non- registered accounts etc. will be sold at fair market value when you pass away, then the CRA will work out what taxes are owed and charge that to the estate of the deceased. So if the estate does not have enough money to pay for the taxes, the kids will have to pay the taxes before they have any ownership of any of the assets. Now the government will release the assets if the CRA can find some security in the kids that those taxes can be paid, and this is all up to how well off the kids are at the time.
Just to step back, there are taxes to be paid and hopefully there is none owing when the estate is finalized, this would be a situation that is different for everyone, depending on the amount of assets, if there is any money owing, the value of the house etc. On top of that you have funeral expenses as well, so the inheritance is never set in stone and depending on the tax rate of the deceased, anywhere from 30% or more will be taken off the inheritance you think you’re getting.
So this is why estate planning is so important, with a proper financial plan and a good insurance portfolio you can guarantee the amount that will be left over for your kids, of course only if you care to leave your kids money. Anyway as I’ve said before I’m here to help, everyone’s situation is different, any questions feel free to contact me.