I am often asked by my clients, “What happens if I die without a will? Will the government take all my assets?”
In my experience as a Wills & Estates Layer, clients who are recent immigrants to Canada are often concerned about what will happen if they die without a will. They have assets in different jurisdictions, are unfamiliar with the Canadian legal system and do not have other family members living in Canada.
“Intestate” means a person who dies without a will. In BC, Wills, Estate and Succession Act (“WESA”) determines how intestate estate will be distributed. Consider the following scenarios:
If a person has a spouse, but no descendants
- If a person dies without a will leaving a spouse but no surviving descendant, the intestate estate must be distributed to the spouse. Spouse and descendants
If a person has a spouse and decendants
- (2) If a person dies without a will leaving a spouse and surviving descendants, the following must be distributed from the intestate estate to the spouse: (a)the household furnishings; (b)a preferential share of the intestate estate in accordance with subsection (3) or (4).
- (3) If all descendants referred to in subsection (2) are descendants of both the intestate and the spouse, the preferential share of the spouse is $300 000, or a greater amount if prescribed.
- (4) If all descendants referred to in subsection (2) are not common to the intestate and the spouse, the preferential share of the spouse is $150 000, or a greater amount if prescribed.
- (6) If the net value of an intestate estate is the same as or greater than the spouse’s preferential share under subsection (3) or (4),
- (a) the spouse has a charge on the intestate estate for the amount of the spouse’s preferential share under subsection (3) or (4), and
- (b) the residue of the intestate estate, after satisfaction of the spouse’s preferential share, must be distributed as follows: (i)one half to the spouse; (ii)one half to the intestate’s descendants.
If a person does not have a spouse
Further, section 23 of the WESA explains what will happen to the intestate estate, if the intestate has no surviving spouse. The intestate estate will be distributed
- To the descendants, [s.23(2)(a)]
- If there is not surviving descendant, to the intestate’s parents, [s. 23(2)(b)]
- Then to the intestate’s siblings/nieces/nephews. [s. 23(2)(c)
- Then to the descendants of the intestate’s grandparents. [s. 23(2)(d)]
- Then to the descendants of the great grandparents of the intestate. [s. 23(2)(e)]
- Finally, if there is no surviving relatives of the intestate at all, the state goes to the government.
So, the answer to the question – “Will the government take all my assets?” is Yes and No. As discussed above, in extreme cases, your asset could go to the government. It is more important to remember that if you do not have a will, you do not have a chance to choose who will receive your assets. Instead, the assets will be distributed by law.