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Wills: Why Consider Primary and Secondary Wills?

The option of preparing Primary and Secondary Wills has always been something to consider if you own shares in a privately held Canadian corporation (particularly for example in a family business) because the shares can be transferred to the beneficiary under the Secondary Will which would not need to be probated. In the example of shares in a family business, the advantage of using a Secondary will would be to avoid the potential difficulty and expense that could be involved in trying to undertake an accurate business valuation of a small private company in order to include the worth of those shareholdings in the probate application.

Until January of 2015, the application for letters probate required two subtotals (one for personal property and one for real property) and their sum, which gave the total value of an estate. The change that came into effect in Ontario in January 2015, now requiring an applicant to itemize the value of all the component parts of an estate, may have increased the accuracy of the stated value of an estate however it has also resulted in some clearly ineffective und unfortunate results. Some executors, now faced with the necessity of valuing all estate items, have no choice but to spend more to value certain items than those items may be worth.

Where the Secondary Will can be used to cover items of the estate such as furnishings or sentimental keepsakes that may have little monetary value and can be transferred under that Secondary Will without the need to have them valued, it should be considered. As a result, the benefit of having a Primary and Secondary Will seems more and more evident, and therefore should be extended to many more testators.

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