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In a June 11, 2004 Technical Interpretation, CRA reviewed a situation where, prior to the death of Brother A, Brother B took care of his personal needs and managed his finances. Brothers C, D and E agreed that the Estate should pay Brother B for the care provided to Brother A.

This is a non-taxable gift to Brother B from the Estate.

Some considerations for elderly taxpayers follow. Contact your professional advisors for details.
  1. Sign a Power of Attorney for management of property and personal care matters.

  2. Avoid probate fees by naming beneficiaries to life insurance policies and pension plans, joint ownership and by multiple wills.

    Also, assets could be rolled over to an Alter Ego Trust or a Joint-Spousal or Common-Law Partner Trust.

  3. A Will may be used to defer gains by transferring assets to a spouse or a Spousal Trust, to deem a charitable donation to have been made in the year of death, to establish a Testamentary Trust eligible for a separate yearend and graduated tax rates, to provide for a windup of a holding company, and to gift publicly traded securities to a charity to take advantage of the 25% taxable capital gain.
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