If you own an incorporated business in Ontario, you can use multiple wills to save thousands in probate taxes. You can legally appoint a specialized Corporate Executor in your Secondary Will solely to manage your business shares, while a different executor handles your personal assets.
Estate Planning Strategies for Ontario Business Owners
For entrepreneurs operating in economic hubs like Mississauga, Kitchener, or Toronto, a standard Last Will and Testament is rarely sufficient. 📍 When you pass away, your estate is subject to the Estate Administration Tax (commonly known as probate tax). If you own shares in a private Ontario Business Corporations Act (OBCA) company, those shares can inflate your estate’s value by millions of dollars, resulting in a massive, unnecessary tax bill upon your death.
To solve this, Ontario law allows for a “Dual Will” strategy. You create a Primary Will for your personal assets (like your house and bank accounts) that requires probate, and a Secondary Corporate Will for your private company shares, which generally does not require probate. Crucially, managing a business during an estate transition is complex. You can appoint a specialized Corporate Executor-someone with business acumen-to handle the company, ensuring a smooth transition. Consulting a corporate estate lawyer from our directory is vital to structure this correctly.
Step-by-Step Process for Creating a Corporate Will in Ontario
Drafting a dual will structure is a highly specialized area of law. 📝 The language must be precise to ensure the two wills do not accidentally revoke one another.
Step 1: Auditing Your Corporate Structure
Before drafting anything, your lawyer and accountant must review your corporate minute book and Shareholder Agreements. If your Shareholder Agreement states that your shares must immediately be sold back to the surviving business partners upon your death, your will must align with this contract. The corporate will cannot override a pre-existing corporate legal agreement.
Step 2: Structuring the Primary and Secondary Wills
Your lawyer will draft two separate documents. The Primary Will covers assets that third parties (like major banks or the Land Registry Office) strictly require probate to release. The Secondary Will explicitly covers shares in privately held corporations, unsecured loans you made to your business, and personal effects. Both wills are signed concurrently, but only the Primary Will is submitted to the Superior Court of Justice.
Step 3: Appointing a Specialized Corporate Executor
You must choose who will manage your business when you die. While your spouse might be the perfect executor for your personal estate, they might not know how to run a manufacturing plant or a tech startup. In the Secondary Will, you can appoint a trusted business partner, an accountant, or a key employee as your Corporate Executor to maintain daily operations without interrupting cash flow.
Step 4: Drafting Specific Management Powers
Your Corporate Executor needs legal authority to act. 🏢 The Secondary Will must include specific corporate clauses granting them the power to vote your shares, elect directors, declare dividends, or even sell the business entirely. Without these explicit clauses, the executor might be paralyzed and unable to authorize payroll or sign commercial leases.
Step 5: Executing the Documents Concurrently
Signing dual wills requires intense attention to detail. Most standard wills start with the phrase, “I hereby revoke all former wills.” If this standard language is used in the Secondary Will, it will accidentally destroy the Primary Will. Your lawyer will ensure the revocation clauses are expertly tailored so both documents coexist legally.
How Much Does it Cost in Ontario?
While drafting multiple wills carries a higher upfront cost, the tax savings are astronomical. As of June 2026, business owners should review these financial considerations:
| Estate Administration Tax (Probate) | In Ontario, probate tax is roughly 1.5% on assets over $50,000 CAD. If your business is worth $2,000,000 CAD, submitting it to probate would cost roughly $30,000 CAD in tax. |
| Cost of Dual Wills | Hiring a specialized estate lawyer to draft a Primary and Secondary Corporate Will typically costs between $1,500 CAD and $4,000 CAD. |
| Net Savings | By spending $3,000 CAD on proper legal drafting, your estate legally avoids the $30,000 CAD tax bill, saving your family tens of thousands of dollars. |
How Long Does the Process Take?
Setting up a comprehensive corporate estate plan is not an overnight task. 🕑 Depending on the complexity of your holding companies and operating companies, the drafting and review process generally takes between 4 to 8 weeks. When you pass away, the Corporate Executor can assume control of the business almost immediately, without waiting the standard 6 to 12 months for the probate court to process the Primary Will.
Frequently Asked Questions (FAQ)
Can I use a Corporate Will for a sole proprietorship?
No. A sole proprietorship is not a separate legal entity from yourself. Secondary wills are only effective for shares in privately incorporated companies (such as an OBCA or federal CBCA corporation).
Can my spouse be both the personal and corporate executor?
Yes. If your spouse has the necessary business knowledge, you can appoint the exact same person to act as the executor for both the Primary and Secondary wills. The tax-saving structure remains perfectly valid.
Will the CRA audit the Secondary Will?
The CRA deals with income tax, not probate tax (which is provincial). However, the Ontario Ministry of Finance has firmly accepted the Dual Will strategy as entirely legal and permissible since the landmark court ruling in Granovsky Estate v. Ontario.
What if my business is sold before I die?
If you sell the business and hold the cash in a standard personal bank account, those funds will fall under your Primary Will and be subject to probate tax. The Secondary Will simply becomes dormant if there are no private shares left to manage.
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