Can high quality businesses create their own luck? Click here to discover with Michael Brown the role of luck in business and how investors can better position themselves for success.

This month’s blog post was authored by Chantal Copithorn, Partner at PwC Canada.

AMT was first introduced in the 1980’s as a way to ensure a minimum amount of tax was paid on income that benefited from certain preferential deductions or incentives.   Since then, there have been minimal changes to the AMT rules. That is, until now.  The 2023 federal budget and recent draft legislation proposed a number of changes to the AMT calculation that could apply in 2024 with the intention of increasing the AMT tax rate, broadening the AMT base and better targeting the AMT to higher income earners.

For background, the AMT applies to individuals (including certain trusts) and is currently calculated as (a) the adjusted taxable income (“ATI”) less an exemption of $40,000, times (b) the lowest federal marginal tax rate (currently 15%) and reduced by (c) certain tax credits.  A taxpayer will pay the higher of their regular tax liability or the AMT tax liability.  To the extent the AMT exceeds the regular tax liability, the excess can be carried forward for seven years and can be credited against the regular taxes payable in those years, provided the regular taxes exceed the AMT in the subsequent year. Each of the provinces also have an AMT.

Proposed Changes

The draft legislation that was issued in August of 2023 proposed a number of changes to the ATI calculation including the following:

• Including 100% of a capital gain
• Including 30% of capital gains arising on the donation of publicly traded securities
• Limiting the deduction for certain interest and financing charges to 50%
• Limiting the deduction for capital loss carryforwards and capital loss carry backs to 50%
• Limiting the deduction for allowable business investment losses to 50%
• Limiting non-capital loss carryovers to 50%
• Eliminate the employee stock option deduction

The proposed changes also include disallowing 50% of non-refundable tax credits including the donation tax credit.

Additionally, the legislation increased the exemption to the second highest tax bracket (approximately $173,000 for 2024, indexed annually for inflation) and the AMT rate to 20.5%.

Certain trusts will now be excluded from the AMT, including graduated rate estates, and the basic exemption will be denied for other inter-vivos trusts (other than qualified disability trusts).

Examples

Let’s look at an example to show the impact of the proposed changes to a taxpayer who earns $100,000 of investment income and has a large one-time capital gain of $1,500,000.

Under the current rules, the taxpayer would pay the regular tax and not be subject to the AMT since the regular tax is higher.  Under the proposed rules, the individual would be required to pay the higher amount of AMT being $292,535, of which $12,035 represents excess AMT that will carryforward and can be applied against federal taxes payable in the next seven years.  This situation could arise where, for example, someone sells a vacation property, and does not claim their principal residence exemption.  Depending on whether the individual has significant income in a future year, they may not be able to recover this punitive tax.

Looking at another example, an individual has a capital gain of $5,000,000 in a year and makes a donation of $4,000,000 to a qualified charity.  The result is:

Under the current rules, the taxpayer will pay the regular tax and will not be subject to the AMT.  The proposed rules will subject the taxpayer to the AMT at a much higher amount.  The taxpayer may consider not making such a substantial donation as a result of the additional cost.

Taxpayers considering transformational donations will also be impacted (e.g., a taxpayer making a significant donation in the year of a sale of a business).  The impact of the proposed AMT and whether they can use the AMT carryforward could be compelling and certainly will influence how much they give.  This could cause a negative impact to the charitable sector resulting in less donations.

Since the rules are proposed to apply in 2024, taxpayers could consider triggering capital gains before the end of the year; and/or making certain donations before the end of the year so that the resulting tax impact can be determined under the current AMT rules.

The Department of Finance requested submissions on various tax proposals including the AMT with a deadline of September 8, 2023.  A number of submissions were made but only time will tell whether any adjustments or relief to the draft proposals will be implemented.

DISCLAIMER

Terms of Use

By accessing the Wealth Matters – Our Insights page, you agree that you have read, understood and agree to be bound by the website terms of use, in addition to the terms stated below.  If you do not agree with this website’s terms of use, please exit from this page, and do not access any other pages on this website.

Cidel Bank & Trust Inc. (including its subsidiaries and affiliates, “Cidel”) reserves the right, at its discretion, to change, modify, add, or remove portions of this page, and the information contained herein, without prior notice. 

Information Is Not Legal or other Advice

Wealth Matters – Ours Insights publications are intended to convey general information about legal issues and developments as of the indicated date.  It does not constitute legal, tax, accounting, or any other advice and must not be treated or relied upon as such.

Statements made in Wealth Matters – Our Insights publications, including the interpretation of case law, are of a general nature only and in no way represent a warranty of the position or accuracy of the law at the time, nor do they pre-determine any position Cidel may take with respect to a specific fact situation or particular client matter. Furthermore, Cidel does not endorse, guarantee the accuracy of, or accept any responsibility for any content written or contributed by third parties who are featured as guest bloggers on Wealth Matters – Our Insights, nor does Cidel endorse, guarantee the accuracy of, or accept any responsibility for the content of third-party websites or materials that may be linked, quoted or otherwise referenced in these publications.  For greater certainty, Cidel does not warrant or guarantee that the information contained on this page is accurate, complete, updated regularly and obtained from reliable sources.

In making the Wealth Matters – Our Insights page available, no client, advisory, fiduciary or professional relationship, including a client-solicitor relationship is created, intended or established. The contents are not a substitute for the user seeking advice from a professional that is familiar with the reader’s factual situation or circumstances.

This month’s blog post was authored by Demetre Vasilounis, associate at Fasken Martineau DuMoulin LLP.

The estates and trusts world has taken notice of the importance of digital assets—there is no question about that. Depending on an individual’s circumstances, their email messages, files, cryptocurrency or similar assets may have great significance to their estate plan. Therefore, if an individual’s digital assets are something that advisors and clients alike need to consider for every estate planning matter, the estates and trusts industry as a whole needs to start to thinking about how to best plan for those digital assets from a legal, financial and technical perspective.

To learn more about this topic, I read the late Sharon Hartung’s novel Digital Executor: Unraveling the New Path for Estate Planning. Sharon was an engineer who spent many years working for IBM. She began writing about digital assets and estate planning after experiencing challenges administering her mother’s estate. I was drawn to Sharon’s work through her first novel Your Digital Undertaker: Exploring Death in the Digital Age in Canada, which is all about taking an information technology-based project management approach to estate planning. WhileYour Digital Undertaker is a great book for anyone who is completely unfamiliar with estate planning, Digital Executor is more geared towards advisors who have only just begun to interact with the issues necessitated by digital assets.

The crux of the book is its exploration of the meaning of the term “digital executor” relative to the digital assets of the testator’s estate. By way of background, a will can delegate different executors for different types of assets: for example, a literary executor may be appointed to deal with copyrights if the deceased was an author, or an art executor may be appointed to manage the testator’s artwork (i.e. if the estate contains a large quantity of artwork). The idea is that these distinct executors have specific skills or knowledge that will assist them in their specialized roles, and are appointed in addition to the “primary” executor who deals with the other estate assets.

Naturally, one might think that a “digital executor” should thus have exclusive domain over the testator’s digital assets. As the novel points out, there are numerous problems with this idea. For instance, consider that many people’s digital and non-digital lives are very much intertwined. This not only means, for example, that people tend to “do everything” from their phones (such as sending messages, listening to music and even tracking their health), but also that their physical assets are very much connected to their digital assets (for instance, through banking or investing apps). This is also amplified by the fact that with each passing year, and each successive generation of people, the average person’s digital footprint is getting larger and larger; naturally, this magnifies the role that digital assets play in one’s overall estate planning.

By way of example, in the 20th century, when a testator died, the executor would have been charged with the task of “going through their papers” in a home or work office and discovering information about the testator’s assets, liabilities and other affairs. While such a discovery process may still be relevant for some individuals today, in the 21st century most people’s email accounts would be the primary means of discovering such information. Indeed, email accounts contain all sorts of critical information: relationships with financial services (i.e. banks, insurance companies), outstanding billings (if, for example, the testator ran their own business or practice), or even information about other digital assets (e.g. if the testator held crypto with any third-party service provider), among many other things. In an increasingly environmentally-conscious world, it’s becoming far less likely that an individual will preserve this information on a piece of paper when an email account is simply more accessible. All of this is to say that if the executor is not able to access the testator’s email account due to a lack of planning on the testator’s part, then this could be a colossal issue for the estate.

As Digital Executor points out, the ability to access a testator’s email accounts isn’t just convenient; it’s essential. Therefore, email accounts of the testator are something that an executor would need to be able to access and manage, and accordingly are not something that should be limited to a digital executor. That’s exactly the argument that Digital Executor makes: the term “digital executor” is an invented one, as today’s executor is a digital executor and as such will need to be equipped to handle managing the testator’s digital footprint and its implications for the testator’s overall estate planning.

Of course, as the trusts and estates industry has begun to learn, a lack of proper planning can lead to being locked out of digital assets that could affect the overall ascertainable value of the estate (like email, as described above) or may themselves have an inherent value (like cryptocurrency). Such planning is important in many ways; even something like neglecting to cancel a testator’s monthly or yearly subscriptions to certain digital services can unnecessarily cost the estate hundreds (or even thousands) of dollars per year.

Digital Executor: Unraveling the New Path for Estate Planning is a great resource for helping advisors learn both the digital assets and overall estate planning questions they should be asking their clients. It’s no secret in any estate planning matter communication is key, and the increasing relevance of this topic will only continue to beget an increasing need for such communication.

DISCLAIMER

Terms of Use

By accessing the Wealth Matters – Our Insights page, you agree that you have read, understood and agree to be bound by the website terms of use,  in addition to the terms stated below.  If you do not agree with this website’s terms of use, please exit from this page, and do not access any other pages on this website.

Cidel Bank & Trust Inc. (including its subsidiaries and affiliates, “Cidel”) reserves the right, at its discretion, to change, modify, add, or remove portions of this page, and the information contained herein, without prior notice. 

Information Is Not Legal or other Advice

Wealth Matters – Ours Insights publications are intended to convey general information about legal issues and developments as of the indicated date.  It does not constitute legal, tax, accounting, or any other advice and must not be treated or relied upon as such.

Statements made in Wealth Matters – Our Insights publications, including the interpretation of case law, are of a general nature only and in no way represent a warranty of the position or accuracy of the law at the time, nor do they pre-determine any position Cidel may take with respect to a specific fact situation or particular client matter. Furthermore, Cidel does not endorse, guarantee the accuracy of, or accept any responsibility for any content written or contributed by third parties who are featured as guest bloggers on Wealth Matters – Our Insights, nor does Cidel endorse, guarantee the accuracy of, or accept any responsibility for the content of third-party websites or materials that may be linked, quoted or otherwise referenced in these publications.  For greater certainty, Cidel does not warrant or guarantee that the information contained on this page is accurate, complete, updated regularly and obtained from reliable sources.

In making the Wealth Matters – Our Insights page available, no client, advisory, fiduciary or professional relationship, including a client-solicitor relationship is created, intended or established. The contents are not a substitute for the user seeking advice from a professional that is familiar with the reader’s factual situation or circumstances.

This month’s blog post was authored by Michael Rosen, Partner at Fogler, Rubinoff LLP

Alter ego and joint spousal or common-law partner trusts (referred to here more simply as a “joint partner trust”) are unique types of trusts that can provide tax savings and estate planning benefits. In the right circumstances, they can be a useful tool for estate planning purposes. In this blog, I provide a brief overview of their features and some considerations about their use.

Key Characteristics

Alter ego trusts and joint partner trusts have the following key characteristics (note that for simplicity, when I write “spouse” I am including “partner” as well).

• The trust is created during the lifetime of the settlor.

In other words, the trust cannot be created by a will.

• The settlor was 65 years or older at the time the trust was created.

The “settlor” is the person who creates a trust. These trusts are only available to those over the age of 65.

• During the settlor’s lifetime (or the settlor and the spouse of the settlor, for a joint partner trust):
  1. the settlor (or the spouse of the settlor, for a joint partner trust) alone must be entitled to receive all of the income of the trust, and
  2. no person other than the settlor (or the spouse of the settlor, for a joint partner trust) can receive any income or capital from the trust.

For an alter ego trust, the settlor is the only person entitled to receive anything from the trust, while the settlor is still alive. For joint partner trusts, the settlor and the settlor’s spouse are the only individuals entitled to receive anything from the trust while either of them is alive.

• The settlor and the trust must be resident in Canada.

A person who is not resident in Canada cannot create an alter ego trust. Furthermore, the trust must remain resident in Canada.

Generally speaking, the residency of a trust is determined based on where the “central management and control” of the trust actually takes place. Therefore, a non-resident trustee should generally not be appointed. This can be an issue if the settlor wants to appoint a child who is not resident in Canada. A trust company may be able to act instead to ensure the residency of the trust remains in Canada.

• For joint partner trusts, both the settlor and the spouse of the settlor can contribute property to the trust.

The CRA has confirmed that two spouses can create a joint partner trust by jointly contributed property to the trust (and no one else contributes). Subsequently, either spouse can continue to contribute property to the trust.

Tax Treatment

Alter ego trust and the joint partner trust get special tax treatment, which is why they are used at all. These features are as follows:

• There are no taxes paid when property is transferred into the alter ego trust.

Normally when a person transfers assets into a trust, there is a deemed disposition and capital gains taxes must be paid on those assets. By default, property transferred into an alter ego trust or joint partner trust does not result in a deemed disposition (although in some circumstances, the person transferring the funds can elect to opt out of this special tax treatment and pay taxes immediately).

• The 21-year deemed disposition rule does not apply.

Normally, a trust is deemed to have disposed of all of its assets on the 21^st anniversary of the trust and therefore would have to pay taxes on any accrued gains in the trust. Alter ego trusts and joint partner trusts are an exception to this rule. Instead, the deemed disposition will occur for alter ego trusts on the death of the settlor, and for joint partner trusts on the death of the survivor of the settlor and the settlor’s spouse.

• The highest marginal rate applies to any taxable income generated in the trust.

This is not a helpful feature, and is in fact similar to most other trusts. These trusts must pay taxes at the highest marginal rate. However, normally trust income is paid to the settlor or the settlor’s spouse, and is then taxed at their respective marginal rate.

Benefits and Drawbacks

Alter ego trusts and joint partner trusts are often used for estate planning and probate planning purposes. In Ontario, probate taxes are called “estate administration tax.” Because trust assets are no longer directly the settlor or contributor’s property, if a will must be submitted for probate, the assets of the trust are not part of the deceased person’s estate and probate tax does not need to be paid on those assets. Furthermore, because the trust continues to exist after the death of the settlor (or the settlor’s spouse), a probated will of the deceased person should not be required and the assets can be accessed more quickly. Finally, it can be helpful when capacity is at issue to have an alternate trustee act instead of someone under a power of attorney.

Other benefits can include privacy (the value of an estate must be listed on a probate application in Ontario, which is technically a public document) and creditor-proofing (a discussion of this is well beyond the scope of this blog).

However, alter ego trusts and joint partner trusts can have drawbacks and therefore are not recommended for everyone. These drawbacks include increased complexity – conceptually, a trust is not a straightforward concept and can be difficult to understand. There also are additional expenses associated with the trust, including the initial setup and annual tax returns that will be required. There are also some negative tax implications, such as a potential mismatch on losses being applied against gains from the settlor’s personal assets and no access to the graduated rate estate rates.

If you are considering using an alter ego trust or joint partner trust or think you might benefit from one, you should talk to your lawyer or professional advisor.

DISCLAIMER

Terms of Use

By accessing the Wealth Matters – Our Insights page, you agree that you have read, understood and agree to be bound by the website terms of use,  in addition to the terms stated below.  If you do not agree with this website’s terms of use, please exit from this page, and do not access any other pages on this website.

Cidel Bank & Trust Inc. (including its subsidiaries and affiliates, “Cidel”) reserves the right, at its discretion, to change, modify, add, or remove portions of this page, and the information contained herein, without prior notice. 

Information Is Not Legal or other Advice

Wealth Matters – Ours Insights publications are intended to convey general information about legal issues and developments as of the indicated date.  It does not constitute legal, tax, accounting, or any other advice and must not be treated or relied upon as such.

Statements made in Wealth Matters – Our Insights publications, including the interpretation of case law, are of a general nature only and in no way represent a warranty of the position or accuracy of the law at the time, nor do they pre-determine any position Cidel may take with respect to a specific fact situation or particular client matter. Furthermore, Cidel does not endorse, guarantee the accuracy of, or accept any responsibility for any content written or contributed by third parties who are featured as guest bloggers on Wealth Matters – Our Insights, nor does Cidel endorse, guarantee the accuracy of, or accept any responsibility for the content of third-party websites or materials that may be linked, quoted or otherwise referenced in these publications.  For greater certainty, Cidel does not warrant or guarantee that the information contained on this page is accurate, complete, updated regularly and obtained from reliable sources.

In making the Wealth Matters – Our Insights page available, no client, advisory, fiduciary or professional relationship, including a client-solicitor relationship is created, intended or established. The contents are not a substitute for the user seeking advice from a professional that is familiar with the reader’s factual situation or circumstances.

Michael Brown, Lead Portfolio Manager CPA, CA, CFA, share a captivating tale that follows investors quest for certainty in an uncertain world.

Click here to read more.

This month’s blog post was co-authored by Justin Irwin, Trust Officer at Cidel Trust Company, and Brodie Kirsh, Associate at Aird & Berlis LLP.

When preparing an estate plan, there are many factors to consider such as tax efficiency, cross-border issues, beneficiary designations and family dynamics. However, it is also essential to think long and hard about your choice of executor (referred to as an “estate trustee” in Ontario). While advance arrangements are incredibly important, you should be cognizant of the fact that unexpected things may happen. Seeking advice from legal and other professionals can help you anticipate issues that may arise from your choice of executor. The following scenarios aim to illustrate what can go wrong with a choice of executor and why professional assistance can be beneficial.

            Scenario 1: The Unreliable Executor

The deceased prepared a Will naming her son as executor. After she died, her son was convicted of a crime and sentenced to prison and so was unable to act.  The alternate executor named in the Will was also unfit to act. The Will was misplaced and, with neither named executor able to act, the Estate went unadministered for two years. The Estate’s debts and expenses went unpaid, and the bank that had provided the deceased with a secured line of credit took possession of her house and sold it for below market value. To resolve this situation, the family’s lawyer applied to the Court to prove a photocopy of the Will and be appointed as executor. As a result of the delays in administration, the value of the Estate was significantly reduced by taxes, legal fees, and bank fees.

As showcased with this example, it is important to consider all an individual’s qualities and behaviors to determine whether there are any ‘red flags’ that might arise in the course of an estate’s administration. If you are unsure of whether your choice of executor would be a good fit, choosing a professional trustee may be the better option to ensure proper and consistent estate administration. Additionally, a professional trustee will be able to hold the original Will in a safe and secure location to avoid the challenges of proving a lost will.

            Scenario 2: The Family Dispute

The deceased in this scenario left a Will naming one of her three children as executor. When the chosen executor was unable to act, poor communication between the three children caused delays before another one of the children was appointed as executor. Once appointed, the executor paid off the mortgage owing on the deceased’s real estate and completed significant repairs and renovations to sell the property. Unfortunately, sour relationships between the siblings provoked a series of disputes over the Estate. These included the amount the executor paid for professional services and other estate expenses, and a variety of issues involving loans and gifts to the siblings during the deceased’s lifetime. The disputes needed to be resolved via lengthy and costly litigation.

As evidenced in this example, appointing a family member to administer an estate, particularly when one sibling is appointed over another, may cause aggravation and exacerbate any existing disagreements within the family. Professional trustees, however, are not personally invested in the estate or the family’s affairs and are unlikely to have a potential conflict of interest. If you anticipate that family issues may cause future discord, it may be prudent to appoint a professional trustee to act as executor over a family member.

            Scenario 3: The Complex Estate

The deceased died in Ontario without a Will. None of his immediate family lived in Canada, and no other family member would be an obvious choice to act as executor. Beyond the logistical difficulties, the deceased had a complicated Estate for a variety of reasons: (1) he was the majority shareholder of a business and the executor needed to determine the value of the shares to be bought out by his business partners, (2) he owned property outside of Canada, meaning that it would be necessary to deal with foreign jurisdictions, and (3) the deceased was involved in litigation before his death, which the executor would need to resolve. Given this state of affairs, none of the deceased’s family were eager to act as estate trustee.

When someone has a complex estate, it may be challenging for friends and family to administer. Rather than burdening those closest to you with a complex estate administration, a professional trustee may be in the best position to effectively administer your estate due to their specialized knowledge and expertise.

Every person’s needs are different when it comes to estate planning and administration. As seen in the above examples, thinking ahead when it comes to your choice of executor can help you avoid many problems and save significant costs. If there is no suitable choice in your family or group of friends to act as executor, or if the estate will be complex or high conflict, then a professional trustee can provide the necessary experience, diligence, and impartiality. It is important to discuss these scenarios with a range of professional advisors such as lawyers, accountants, and wealth managers to ensure that there will always be a suitable executor who can continue the administration of the estate and any trusts that are included in your Will.

DISCLAIMER

Terms of Use

By accessing the Wealth Matters – Our Insights page, you agree that you have read, understood and agree to be bound by the website terms of use,  in addition to the terms stated below.  If you do not agree with this website’s terms of use, please exit from this page, and do not access any other pages on this website.

Cidel Bank & Trust Inc. (including its subsidiaries and affiliates, “Cidel”) reserves the right, at its discretion, to change, modify, add, or remove portions of this page, and the information contained herein, without prior notice. 

Information Is Not Legal or other Advice

Wealth Matters – Ours Insights publications are intended to convey general information about legal issues and developments as of the indicated date.  It does not constitute legal, tax, accounting, or any other advice and must not be treated or relied upon as such.

Statements made in Wealth Matters – Our Insights publications, including the interpretation of case law, are of a general nature only and in no way represent a warranty of the position or accuracy of the law at the time, nor do they pre-determine any position Cidel may take with respect to a specific fact situation or particular client matter. Furthermore, Cidel does not endorse, guarantee the accuracy of, or accept any responsibility for any content written or contributed by third parties who are featured as guest bloggers on Wealth Matters – Our Insights, nor does Cidel endorse, guarantee the accuracy of, or accept any responsibility for the content of third-party websites or materials that may be linked, quoted or otherwise referenced in these publications.  For greater certainty, Cidel does not warrant or guarantee that the information contained on this page is accurate, complete, updated regularly and obtained from reliable sources.

In making the Wealth Matters – Our Insights page available, no client, advisory, fiduciary or professional relationship, including a client-solicitor relationship is created, intended or established. The contents are not a substitute for the user seeking advice from a professional that is familiar with the reader’s factual situation or circumstances.

This month’s blog post was written by Jennifer A.N. Corak, Partner at Minden Gross LLP.

In Ontario, [1] estates lawyers are routinely faced with questions regarding probate tax and probate planning.  This article discusses some often-asked questions.

What is Probate Tax?

“Probate tax” (formally, Estate Administration Tax) is paid when an application is made for a Certificate of Appointment of Estate Trustee to prove the authority of an executor to administer a deceased’s estate and, if the deceased died with a Will, to prove the validity of that Will (a process often referred to as probating the Will). [2] Whether such a Certificate is needed generally depends on the type of assets owned by the deceased at death, and whether they died with a Will. For example, when an individual dies with a Will, the Will gives the named executor the authority to act; however, third parties sometimes require proof of that authority before allowing such executor to administer the deceased’s assets. The named executor obtains this proof by applying for a Certificate of Appointment from the Ontario Superior Court of Justice. [3]

How is Probate Tax Calculated?

Probate tax is currently calculated as 1.5% of the value of the assets administered under the Will being probated above $50,000. [4]  Therefore, if the assets flowing through a Will had a value of $2,050,000 at the deceased’s death, $30,000 of probate tax would be owing as part of the application (calculated as ($2,050,000 – $50,000) x 1.5%).  Certain asset values are not included in the calculation (e.g., the value of assets that flow outside of the Will and of real estate outside Ontario). Where Ontario real estate is concerned, the value to be included in the calculation is the value less encumbrances.

What is “Probate Planning”? Can Probate Tax Exposure be Minimized?

“Probate planning” is used to describe taking steps to reduce exposure to probate tax. A number of strategies can be employed to do so, but it is important to remember that no two situations are the same.  Each individual must consider their own personal circumstances, including their wishes regarding asset distribution, and should get legal advice from a qualified estates lawyer before engaging in probate planning.  Some examples of probate planning opportunities, as well as high-level comments on each, follow:

1. Multiple Wills

In Ontario, a common probate planning strategy is the execution of multiple Wills. As mentioned above, probate tax is calculated based on the value of the assets being governed by the Will being probated. Certain assets would not need a probated Will to be dealt with (e.g., probate is often not needed to deal with shares in closely-held private corporations and personal effects).

This strategy generally separates assets into two categories. One Will (often called the “Secondary Will” or “Non-probated Will”) governs the distribution of assets that do not need a Certificate of Appointment to be administered, and the other Will (often called the “Primary Will” or “Probated Will”) governs the distribution of the remaining assets.  Only the value of those assets that fall under the Primary Will being probated would be exposed to probate tax.  The cost and added complexity of this planning is often weighed against the possible probate tax savings on death.

For example, consider the business owner that holds shares in a private corporation worth $1,000,000, where the other shareholders do not require proof of the executor’s authority to act.  By having a Secondary Will govern the distribution of such shares, probate tax exposure is reduced by $15,000.

2. Bare Trust Planning

In Ontario, legal and beneficial ownership can be split, opening the door to bare trust planning using a nominee corporation (the “Nominee”). This strategy involves transferring legal title in an asset to a Nominee while keeping beneficial ownership.  Despite being on title, the Nominee is only an agent of the beneficial owner(s) and the relationship between the Nominee and beneficial owner(s) is generally documented by a written agreement or declaration of trust.  On the beneficial owner’s death, legal ownership remains with the Nominee and beneficial ownership is transferred in accordance with the deceased’s Secondary Will (meaning the need for properly drafted multiple Wills). Set up and on-going maintenance costs should be considered before engaging in this planning.

3. Designating Beneficiaries

When beneficiaries (other than a deceased’s estate) are designated on life insurance policies and registered investment accounts, they pass directly to the designated beneficiaries (not forming part of the deceased’s estate) and are not subject to probate tax.

Before designating a beneficiary, consideration should be given to how the designation fits within the overall estate plan (e.g., perhaps liquidity from the registered account is needed to satisfy cash gifts in the Will).  Form and content of the designation should also be considered, as well as tax consequences that flow from it (if any).

4. Joint Assets

If assets are held jointly so that they pass automatically to a surviving owner on the death of the first to die, then such assets pass outside of the deceased’s estate and are not subject to probate tax.  This strategy, if effective, would only avoid probate tax on the first death. It is often seen with spouses (e.g., when they own their home as joint tenants, with right of survivorship [5]).

There are legal considerations before engaging in this planning, particularly when a parent is contemplating adding a child as joint owner. A qualified estates lawyer should be consulted before taking steps to change ownership, and legal advice should be obtained regarding risks associated with joint ownership (e.g., exposure to creditors), and steps needed for this strategy to be effective (sometimes multiple Wills are needed).

Conclusion

With careful planning it is possible to reduce exposure to probate tax, but what may be an appropriate probate planning strategy for one might not be for another. Probate planning should be considered in the context of an individual’s estate plan as a whole, with the benefit of legal advice, and the individual should remember that changes in law, circumstances or the administrative practices of third parties can impact a plan’s effectiveness.

[1] This article focuses on the laws in the Province of Ontario.

[2] An executor may want or need to probate a Will for other reasons; this is beyond the scope of this article.

[3] If an individual dies without a Will, someone would apply to have authority to administer the deceased’s assets.

[4] The value of the estate is rounded up to the nearest thousand (e.g., if the value was $2,049,250, probate tax would be calculated on $2,050,000).

[5] As opposed to owning their home as tenants in common.

DISCLAIMER

Terms of Use

By accessing the Wealth Matters – Our Insights page, you agree that you have read, understood and agree to be bound by the website terms of use,  in addition to the terms stated below.  If you do not agree with this website’s terms of use, please exit from this page, and do not access any other pages on this website.

Cidel Bank & Trust Inc. (including its subsidiaries and affiliates, “Cidel”) reserves the right, at its discretion, to change, modify, add, or remove portions of this page, and the information contained herein, without prior notice. 

Information Is Not Legal or other Advice

Wealth Matters – Ours Insights publications are intended to convey general information about legal issues and developments as of the indicated date.  It does not constitute legal, tax, accounting, or any other advice and must not be treated or relied upon as such.

Statements made in Wealth Matters – Our Insights publications, including the interpretation of case law, are of a general nature only and in no way represent a warranty of the position or accuracy of the law at the time, nor do they pre-determine any position Cidel may take with respect to a specific fact situation or particular client matter. Furthermore, Cidel does not endorse, guarantee the accuracy of, or accept any responsibility for any content written or contributed by third parties who are featured as guest bloggers on Wealth Matters – Our Insights, nor does Cidel endorse, guarantee the accuracy of, or accept any responsibility for the content of third-party websites or materials that may be linked, quoted or otherwise referenced in these publications.  For greater certainty, Cidel does not warrant or guarantee that the information contained on this page is accurate, complete, updated regularly and obtained from reliable sources.

In making the Wealth Matters – Our Insights page available, no client, advisory, fiduciary or professional relationship, including a client-solicitor relationship is created, intended or established. The contents are not a substitute for the user seeking advice from a professional that is familiar with the reader’s factual situation or circumstances.

Click here to read more.

This month’s blog post was written by Andrea Tratnik, Partner, Trusts and Estates Group, and Damian Di Biase, Student-at-Law, at Beard Winter LLP.

Last year, significant changes were made to the Succession Law Reform Act, RSO 1990, c S.26 (“SLRA”), which is the primary legislation in Ontario that governs estate law. In particular, effective January 1, 2022, key amendments were made to the SLRA regarding the remote witnessing of Wills, testamentary effects of marriage and marriage dissolution, and validating testamentary documents. These changes, which have had a considerable impact on estate planning, are outlined below.

Parties can continue to use audio-visual communication technology for Will signings

Prior to the Covid-19 pandemic, Wills and Powers of Attorney had to be signed in the physical presence of two witnesses. Emergency measures were introduced during the pandemic to allow for virtual signings of these documents; changes to the SLRA made these measures permanent for Wills and corresponding changes to Ontario’s Substitute Decisions Act, 1992, SO 1992, c 30 made these measures permanent for Powers of Attorney.

More particularly, testators and witnesses may continue to use audio-visual communication technology to satisfy the requirement that they be in the presence of each other for the signing of a Will or Power of Attorney. This option may assist testators who have poor health or mobility issues by enabling them to participate in estate planning fully via platforms such as Zoom or Microsoft Teams. In order to proceed with a virtual signing, at least one witness must be a lawyer or a paralegal.

Electronic signatures on Wills and Powers of Attorney are still not permitted. Virtual signings require wet ink signatures and involve the use of counterpart documents.

Marriage no longer revokes Wills, but spousal gifts and executor appointments are revoked upon separation

Formerly, a Will was automatically revoked by marriage. As a result of the SLRA changes, marriage no longer revokes a Will.  The result of this amendment is that testators who have Wills preceding a marriage will not have to re-make or re-sign their Wills in order for such Wills to remain in effect after marriage; they will, however, need to consider whether they wish to make changes to the terms of their Wills to provide for their new spouse.

While marriage no longer revokes a Will, any testamentary gift made to a spouse, and any appointment of a spouse as executor or trustee, will be revoked upon separation. This revocation formerly applied only upon divorce.

A spouse will be considered to be separated from a testator if, before the testator’s death, they were living separate and apart as a result of the breakdown of their marriage for a period of three years, they entered into a valid separation agreement, or either a court order or a family arbitration award was made in the settlement of their affairs arising from the breakdown of their marriage.

Spouses who are separating but still intend to give testamentary gifts to each other will need to update their testamentary documents to ensure these gifts are not revoked.

Spousal entitlements no longer apply to the separated spouse if the deceased dies intestate

If a person dies without a Will, their estate will be distributed in accordance with the intestacy laws set out under the SLRA. Generally, a person’s spouse and children are the primary beneficiaries under an intestacy and, formerly, the SLRA made no distinction between spouses and separated spouses.

Separated spouses are now excluded from being able to receive spousal entitlements on an intestacy. A spouse will be considered separated from the deceased for this purpose in accordance with the same criteria set out above.

While this change may prevent some unwelcome consequences, it remains advisable to have a Will in place to adequately address all testamentary intentions.

Improperly executed Wills can now be validated through an application to court

Previously, a Will was not valid if it did not comply with the formal signing and witnessing criteria set out under the SLRA.

However, parties may now apply to the Superior Court of Justice for an order that an improperly executed Will is valid and fully effective. The Court may grant the order if it is satisfied that the document sets out the testamentary intentions of the deceased.

This amendment may assist in situations where – due to timing issues or otherwise – a document was not executed properly but testamentary intentions are clear. Despite this relieving provision, it remains advisable to meet all formal requirements when signing a Will.

Conclusion

For more information on these changes and for further assistance in your estate planning, please reach out to your wealth consultant and/or a lawyer.

* A modified version of this article first appeared on Beard Winter LLP’s website on March 31, 2023.

DISCLAIMER

Terms of Use

By accessing the Wealth Matters – Our Insights page, you agree that you have read, understood and agree to be bound by the website terms of use,  in addition to the terms stated below.  If you do not agree with this website’s terms of use, please exit from this page, and do not access any other pages on this website.

Cidel Bank & Trust Inc. (including its subsidiaries and affiliates, “Cidel”) reserves the right, at its discretion, to change, modify, add, or remove portions of this page, and the information contained herein, without prior notice. 

Information Is Not Legal or other Advice

Wealth Matters – Ours Insights publications are intended to convey general information about legal issues and developments as of the indicated date.  It does not constitute legal, tax, accounting, or any other advice and must not be treated or relied upon as such.

Statements made in Wealth Matters – Our Insights publications, including the interpretation of case law, are of a general nature only and in no way represent a warranty of the position or accuracy of the law at the time, nor do they pre-determine any position Cidel may take with respect to a specific fact situation or particular client matter. Furthermore, Cidel does not endorse, guarantee the accuracy of, or accept any responsibility for any content written or contributed by third parties who are featured as guest bloggers on Wealth Matters – Our Insights, nor does Cidel endorse, guarantee the accuracy of, or accept any responsibility for the content of third-party websites or materials that may be linked, quoted or otherwise referenced in these publications.  For greater certainty, Cidel does not warrant or guarantee that the information contained on this page is accurate, complete, updated regularly and obtained from reliable sources.

In making the Wealth Matters – Our Insights page available, no client, advisory, fiduciary or professional relationship, including a client-solicitor relationship is created, intended or established. The contents are not a substitute for the user seeking advice from a professional that is familiar with the reader’s factual situation or circumstances.

This month’s blog post was written by Hayley Peglar, Partner at WeirFoulds LLP.

Incapacity planning refers to addressing circumstances in which you are unable to make decisions on your own behalf while you are alive. Turning your mind to potential future incapacity can give you agency in decisions made on your behalf and soften the impact of a further temporary or permanent incapacity for your loved ones.

This post focuses on Ontario’s framework for two key realms of decision making: property and personal care. In general, when you are unable to make these decisions, they are made by either your attorney[1] under the terms of a power of attorney document or they are made by a statutory or court-appointed guardian of property.[2] The Substitute Decisions Act, 1992 (the “SDA“)[3] sets out the framework for powers of attorney and guardianships of property and of personal care/the person.

Decisions about Property

Decisions about property include those concerning a person’s assets and liabilities of all forms, including, e.g., cash and investments, real estate, corporate interests, digital property, and taxes.

The SDA permits a person (referred to as the “grantor”) to grant a continuing power of attorney for property. A continuing power of attorney is a document which gives authority to the attorney to manage the grantor’s property even once the grantor has lost capacity to make decisions about their property. The attorney will be able to do on the person’s behalf anything in respect of property that the person could do if capable, except make a will, subject to the conditions and restrictions set out in the power of attorney.

What happens if a person does not have a power of attorney for property in place? If a certificate is issued under the Mental Health Act,[4] the Public Guardian and Trustee will be the person’s statutory guardian of property unless and until they are replaced.[5] If no certificate has been issued under the Mental Health Act, it will be necessary to start a guardianship application.

Any person[6] may apply to the Ontario Superior Court of Justice to seek to be appointed by court order as an incapable person’s guardian of property. Guardianship applications take time (often months, and sometimes even years) and can cost in the tens of thousands of dollars (and much more if the guardianship is contested). A guardianship application must be served not only on the allegedly incapable person and the Public Guardian and Trustee, but also on their spouse or partner, children who are at least eighteen, parents, and brothers and sisters (if these people are known). Depending on your family dynamics, this may not be consistent with your wishes about who is given notice of your incapacity. While guardianships play a crucial role in the protection of incapable adults, they require a public court process, when you may wish for your personal circumstances (such as your medical circumstances and financial circumstances) to be kept private. The court might appoint someone as your guardian you would not choose yourself.

Decisions About Personal Care

Decisions about personal care include those concerning health care, nutrition, shelter, clothing, hygiene and safety.

What happens if a person loses capacity to make personal care decisions without a power of attorney for personal care in place? While the Health Care Consent Act identifies substitute decision makers for medical treatment where there is no attorney for personal care or guardian of the person, decisions relating to other personal care matters are not clearly provided for by legislation. It may be necessary for a family member or friend to apply to the court to have a guardian of the person appointed. As with a guardianship for property, such an application may be expensive, time consuming, invasive, and at odds with your personal preferences.[7]

Your attorney for property and your attorney for personal care do not need to be the same person. As a practical matter, if a person has lost capacity to manage property and personal care, it is important that the attorneys for property and for personal care are able to work together cooperatively.

The Importance of Legal Advice in Incapacity Planning

While there are standard form powers of attorney available online, reliance on these “one size fits all” forms can be risky.

A lawyer can help to ensure your power of attorney documents are legally valid and have your intended effect. A lawyer can also help you to understand the options you have when preparing a power of attorney document. For example, a power of attorney for property can be drafted to be immediately effective or effective at a specified date or when a specified contingency happens (such as a declaration of incapacity).[8]

A lawyer can also explain the duties and obligations of an attorney for property and attorney for personal care, and the risks of misuse of a power of attorney document. This will help you identify who you trust to fulfil these important roles.

Planning Ahead

Incapacity planning gives you a voice in who makes critical decisions about your life when you are unable to make these decisions yourself and can avoid the stress and expense of a court proceeding.

[1] In the context of powers of attorney, “attorney” refers to the named substitute decision maker, not a lawyer.

[2] In addition, the Health Care Consent Act, 1996, SO 1996, c 2, Sched A, as amended (the “HCCA“), sets out a hierarchy of substitute decision makers for medical treatment decisions. See s. 20 of the HCCA.

[3] Substitute Decisions Act, 1992, SO 1992, c 30.

[4] Mental Health Act, RSO 1990, c M7, as amended.

[5] SDA, s 15. There is a process to replace the Public Guardian and Trustee as statutory guardian of property.

[6] Other than a person who provides health care or residential, social, training or support services to an incapable person for compensation. There is an exception for spouses, partners, relatives, attorneys for personal care, and attorneys for property.

[7] An application for a guardianship of the person must be served on the allegedly incapable person’s children aged sixteen and over.

[8] SDA, s 7(7).

DISCLAIMER

Terms of Use

By accessing the Wealth Matters – Our Insights page, you agree that you have read, understood and agree to be bound by the website terms of use,  in addition to the terms stated below.  If you do not agree with this website’s terms of use, please exit from this page, and do not access any other pages on this website.

Cidel Bank & Trust Inc. (including its subsidiaries and affiliates, “Cidel”) reserves the right, at its discretion, to change, modify, add, or remove portions of this page, and the information contained herein, without prior notice. 

Information Is Not Legal or other Advice

Wealth Matters – Ours Insights publications are intended to convey general information about legal issues and developments as of the indicated date.  It does not constitute legal, tax, accounting, or any other advice and must not be treated or relied upon as such.

Statements made in Wealth Matters – Our Insights publications, including the interpretation of case law, are of a general nature only and in no way represent a warranty of the position or accuracy of the law at the time, nor do they pre-determine any position Cidel may take with respect to a specific fact situation or particular client matter. Furthermore, Cidel does not endorse, guarantee the accuracy of, or accept any responsibility for any content written or contributed by third parties who are featured as guest bloggers on Wealth Matters – Our Insights, nor does Cidel endorse, guarantee the accuracy of, or accept any responsibility for the content of third-party websites or materials that may be linked, quoted or otherwise referenced in these publications.  For greater certainty, Cidel does not warrant or guarantee that the information contained on this page is accurate, complete, updated regularly and obtained from reliable sources.

In making the Wealth Matters – Our Insights page available, no client, advisory, fiduciary or professional relationship, including a client-solicitor relationship is created, intended or established. The contents are not a substitute for the user seeking advice from a professional that is familiar with the reader’s factual situation or circumstances.

Arthur Heinmaa, CFA, Chief Investment Officer, examines the rapid failure of the Silicon Valley Bank.

Click here to read more.

This month’s blog post was written by Anna Alizadeh, Head of Wealth Planning at Cidel.

It has been said that the two certainties in life are death and taxes.  It is therefore no surprise that planning for these certainties has become an increasingly popular topic.  Typically, planning for death and taxes involves executing a last will and testament (i.e., a will), which is a legal document that designates how your assets will be managed and distributed after death.

It can be daunting to think about one’s own death and how to divide assets among loved ones.  But there are several reasons why it is imperative to have a valid will in place, including the ability to choose a guardian for one’s minor children; protecting and planning for minors’ inheritance; avoiding unnecessary headaches for family members; making desired charitable donations; and minimizing probate fees and taxes.  Further, planning ahead provides the ability to choose a trusted executor/trustee to carry out one’s wishes.  A trust company, like Cidel Trust Company*, can be appointed as an executor/trustee to reduce the burden and potential liability of estate administration on family and friends.

Just as importantly, making a will allows an individual to choose the persons or organizations they wish to leave money to and in what amounts.  However, if an individual dies intestate (i.e., without a will), the distribution of their estate is governed by the specific intestacy rules of the province in which they are domiciled, which rules may not be on par with the person’s wishes.  In Ontario, for example, the laws on intestacy are set out in Part II of the Succession Law Reform Act.  The Succession Law Reform Act provides for a list of individuals, in hierarchical order, to whom the law presumes the deceased would have wanted to leave money.  For example:

• if you are married and have no children at the time of your death, your spouse will inherit your entire estate;
• if you are married with children, your spouse will first inherit a “preferential share” of the value of your estate and the remainder of the estate (if any) is divided among your spouse and children (how the remainder is split depends on the number of children you have).  The regulations made under the Succession Law Reform Act were recently amended to increase the value of a surviving spouse’s “preferential share” from $200,000 to $350,000 where a deceased died intestate on or after March 1, 2021;
• if you are not survived by a spouse or any issue, your estate is distributed to your closest living blood relatives (for example, parents would take priority over all other living relatives. If your parents are not alive, your siblings will inherit your estate in equal shares. If your siblings are not alive, your nieces and nephews, etc.); and
• if you have no next of kin, your estate will escheat to the Crown (i.e., your property will become the Crown’s property).  This is quite rare.

In the event of an intestacy, common-law spouses do not have the same statutory rights to an estate as married spouses.  However, while the law provides a roadmap as to who should receive an intestate person’s estate or a share thereof, a common-law spouse, an unhappy family member, or a multitude of other persons can nevertheless come after the estate and fight for a piece of the pie.  It is therefore best to make a will and avoid the costly and time-consuming litigation that would ensue in the case of an intestacy.

Many difficulties can arise because of insufficient or improper estate planning.  Making a will and ensuring one’s estate planning is up to date can prevent a myriad of adverse outcomes after death, including complicated estate administration and costly litigation.  If you have any concerns or questions about the current status of your estate planning, please contact your Wealth Consultant to discuss your options.

* Please contact your Wealth Consultant to learn about how Cidel Trust Company, a federally licensed trust company, can assist with the administration of your estate.

DISCLAIMER

Terms of Use

By accessing the Wealth Matters – Our Insights page, you agree that you have read, understood and agree to be bound by the website terms of use,  in addition to the terms stated below.  If you do not agree with this website’s terms of use, please exit from this page, and do not access any other pages on this website.

Cidel Bank & Trust Inc. (including its subsidiaries and affiliates, “Cidel”) reserves the right, at its discretion, to change, modify, add, or remove portions of this page, and the information contained herein, without prior notice. 

Information Is Not Legal or other Advice

Wealth Matters – Ours Insights publications are intended to convey general information about legal issues and developments as of the indicated date.  It does not constitute legal, tax, accounting, or any other advice and must not be treated or relied upon as such.

Statements made in Wealth Matters – Our Insights publications, including the interpretation of case law, are of a general nature only and in no way represent a warranty of the position or accuracy of the law at the time, nor do they pre-determine any position Cidel may take with respect to a specific fact situation or particular client matter. Furthermore, Cidel does not endorse, guarantee the accuracy of, or accept any responsibility for any content written or contributed by third parties who are featured as guest bloggers on Wealth Matters – Our Insights, nor does Cidel endorse, guarantee the accuracy of, or accept any responsibility for the content of third-party websites or materials that may be linked, quoted or otherwise referenced in these publications.  For greater certainty, Cidel does not warrant or guarantee that the information contained on this page is accurate, complete, updated regularly and obtained from reliable sources.

In making the Wealth Matters – Our Insights page available, no client, advisory, fiduciary or professional relationship, including a client-solicitor relationship is created, intended or established. The contents are not a substitute for the user seeking advice from a professional that is familiar with the reader’s factual situation or circumstances.

There has been an unprecedented transfer of wealth from one generation to the next in recent years.  In addition, people are living longer and, more and more, we are seeing complicated estates as a result of individuals and families moving to or owning assets in different jurisdictions.  As a result of these new realities, there is an ever-increasing need to have appropriate strategies in place to address concerns of conveying wealth to the next generation, aging, and maintaining a family or business legacy.

At Cidel, we are committed to empowering our clients with practical knowledge in the areas of trusts, estates, capacity, and succession planning to allow clients to navigate through these sensitive considerations.  Wealth Matters – Our Insights will bring together trusted legal, accounting, and other professionals to discuss interesting topics that are relevant to you.

We invite you to subscribe to Wealth Matters – Our Insights to receive our monthly blogs.  You can unsubscribe at any time.

Charles Lannon, CFA, discusses Cidel’s Global Equity Strategy and new investments made in the last quarter of 2022. He elaborates on equity performance for 2022 and shares his views on the outlook for 2023.

Click here to read.

Ryan Elliott, one of our Toronto based Wealth Consultants, was invited by BNN Bloomberg for a discussion on inflation, how the markets are reacting to key data and how Cidel positions client portfolios for success in current market environments. The discussion is a wide ranging one covering topics that clients have brought up with our team in recent weeks. We invite you to watch the two segments that BNN Bloomberg have made available on their site by clicking here.

We are pleased to present our Q3 insights and commentaries.

Click here to read it in full.

Autumn reminds us of heading back to school. Therefore, with the back-to-school feeling in mind we are going back-to-basics about how we invest at Cidel.

Click here to read more.

Please enjoy our teams insights, commentaries and Cidel In The News.

Click here to read it in full.

The dominant narrative in the market this quarter was, unsurprisingly, a debate surrounding whether or not the global economy would fall into recession, when that might be, and how severe? 

Click here to read more.

If you are feeling uneasy or anxious about the current state of the markets, you’re not alone. Our latest post is a reminder that, in the long-run, things almost always work out for the better.

Read More.

This report covers topics including Cidel’s performance summary, our estate planning overview, a breakdown of stock rivalries and more. Enjoy!

Click here to read it in full.

Equities had a memorable first quarter of 2022, but entirely for awful reasons.

Early in the quarter markets exhibited weakness as they continued to digest the reality that persistent inflation was helping to bring the era of extreme central bank and fiscal liquidity to a close. 

Click here to read more.

Click here to read Arthur Heinmaa’s, Chief Investment Officer, views on the Russian invasion of Ukraine.

Our Charles Lannon, Senior Vice President and Head of Equities,  provides his commentary on our Global Equity Strategy. He begins:

“2021 was another year of double digit returns in global equities, with the MSCI World Index returning 22.3% in U.S. dollar terms (or 21.2% in Canadian dollar terms). This strong annual return is consistent with a sharp rebound in both economic growth and earnings. It is projected that global GDP growth in 2021 will come in around 5.9% the best result in well over a decade.”

READ MORE.

We are ending the year on a charitable note. Our partnership with the Salvation Army of Barbados has progressed over 20 years and we are happy to support them once again.

Our ethos of corporate social responsibility has led us to create The Children First Trust charity. This year we felt the need to make a more significant contribution and expand our efforts to include more families in need.

Read the full article here.

Our Q3 2021 Quarterly Report is out!

This report covers topics including Cidel’s performance summary, our partnership with TwinRiver Capital Group, a podcast recording from our Latin American team and more. Enjoy!

Click here to read it in full.

Our partnership with TwinRiver Capital Group marks a new milestone.

We have just announced the launch of the Cidel-TwinRiver Global Impact Fund (the “TwinRiver Global Impact Fund” or the “Fund”).

This new Fund offers investors exposure to companies working intentionally and pro-actively on making a positive social and environmental contribution.

Click here to read the full details.

Our Q2 2021 Quarterly Report is out!

This report covers topics including Cidel’s performance summary, our acquisition of Lorica, a recording on timing the market and more. Enjoy!

Click here to read.

Cidel Asset Management Inc. (Cidel) and TwinRiver Capital are pleased to announce our new partnership.

“Cidel is very excited to be a founding partner with TwinRiver, and to support the growth of this important new firm.  We see the growing demand for impact products from our clients.  We are confident that the TwinRiver team is uniquely positioned to deliver on the promise of impact investing for both individual investors and institutions,” said Henry Perren, President of Cidel.

TwinRiver is focused on serving a new generation of private, public and philanthropic investors looking to make a positive difference with their capital. The TwinRiver platform will provide those investors with opportunities to achieve tangible social and environmental impacts alongside financial returns – the “twin rivers” of a future financial system.

Read the full press release here.

Cidel’s Ben Arrindell has been awarded the Commander of the British Empire (CBE).

He has received this award for his contributions to the international business services sector in Barbados.​ Ben, while also Deputy Chairman of Cidel Bank & Trust, is an ‘in-demand’ speaker on the international tax circuit. He is advisor and consult to many institutions; one being the United Nations Committee of Experts on International Cooperation in Tax Matters.

No one is more deserving of this award than Ben, who, over the last 30 years, has made significant contributions to the development of international business policy in Barbados.

Cidel was proud to sponsor the Canadian Association of University Business Officers (CAUBO) Annual Conference that took place June 15-17, 2021.

This annual conference is CAUBO’s flagship development event, with sessions focusing on trends and hot topics in higher education.

More information can be found here.

Cidel Asset Management Inc. (Cidel) and Lorica Investment Counsel Inc. (Lorica) are pleased to announce that they have reached an agreement under which Cidel will acquire 100% of Lorica.

Lorica brings to Cidel exceptional talent and a client base that comprises about $900 million in assets. The current President of Lorica, Gary Morris, will assume leadership of Cidel’s Fixed Income team. “I am excited to work with the portfolio management team at Cidel and look forward to providing clients with quality solutions and leveraging the additional resources that Cidel has to offer” says Gary.

Arthur Heinmaa, Cidel’s Chief Investment Officer explains that Cidel’s business has grown significantly in recent years and with changes in the market, fixed income investing faces the need for even more resources and talent. “Our clients continue to look for innovative solutions for income investing. Gary and his team are ideally positioned to complement and build on Cidel’s capabilities”

“The goal is first and foremost about building capabilities for clients and adding the best talent to our team. We look forward to welcoming Lorica and its clients to Cidel and are excited about the new opportunities that will result.” According to Cidel’s Chief Executive Officer, Craig Rimer.

The transaction is subject to regulatory approvals and is anticipated to close in June 2021.

Click here to read the Press Release.

Our Q1 2021 Quarterly Report is out!

This report covers topics including Cidel’s performance summary, investment team research, a recording of our ESG strategy and more. Enjoy!

Click here to read.

Our Q4 2020 Quarterly Report is out!

This report covers topics including Cidel’s performance summary, vaccines on investing, a recording of our investment conference and more. Enjoy!

Click here to read.

We recently held the second event in our Not-For-Profit Series.

Our Christy DeCosimo and Catherine Jackman sat down virtually to speak with Hugh MacPhie, a highly experienced Not-For-Profit advisor.

The presentation focused on the art and science of strategic planning.

Resources:

Presentation Video

Presentation Slides

Harvard Business Review Article Link

Our Barbados office partnered with Lions International​ for ‘Operation Christmas’ to supply household goods and food for 200 families.

They worked together to fill these hampers with food, toiletries and other essential household goods.

Watch our Barbados team in action!

We were pleased to be a sponsor, and our Catherine Jackman a speaker, at the Canadian Investment Institute.

This event aimed to educate trustees in the pension sector.

Catherine co-presented on the ripple effects of low rates, insights from Japan’s “lost decade” and considerations for pension plans.

Follow us for event details here.

Our own Catherine Jackman and Christy DeCosimo spoke at the virtual Foundation, Endowment & Not For Profit Investment Summit on December 3, 2020.

This event highlighted the use of effective investment strategy to mitigate risks, achieve better portfolio performance and meet a not-for-profit organization’s stated mandate.

Our team gave an enlightening presentation on corporations, society and the shifting dynamics.

See our team in action.

The holiday spirit begins at Cidel Bank & Trust Barbados with a donation of $25,000 along with 40 tablets to children in need.

The donation was made recently at the Salvation Army’s Reed Street headquarters. It is part of the Bank’s ongoing outreach efforts to assist schools and vulnerable groups within the surrounding area of its Collymore Rock location.

Some students either had no access to online classrooms or had to use their parents’ cellphones to access online classes – a situation that was not tenable.

Cidel is proud to say our donation will not only help with the current learning situation but also for further years of education in Barbados.

Read the full article here.

Last week we hosted our Annual Investment Discussion.

Our event ended with a panel of Cidel experts who discussed the key factors, risks and the impact of the election as well as COVID-19.

Click Here to watch the 20 minute discussion.

Cidel has sponsored CPA Alberta‘s Annual Forum that covers industry news.

We are proud to promote an event that is about looking forward and exploring the possibilities.

Click Here for more information.

Our Q3 2020 Quarterly Report is out!

This report covers topics including Cidel’s performance summary, a podcast on ESG, award nomination outcomes and more. Enjoy!

Click here to read.

Cidel continues to look for client centric solutions and the partnership with ERI and its OLYMPIC Banking System which started in 2016 has allowed Cidel to continue to be a major player in the UHNW space.

 The implementation of the OLYMPIC Banking System achieved a number of positive outcomes:

1. Cidel eliminated 3 existing systems resulting in a significant annual cost savings both in license costs and IT support.
2. The system enabled client relationship managers to focus on building client relationships instead of building reports. This helped Cidel grow its AUM even during the initial stages of the implementation
3. Reduced the amount of time spent on regulatory reporting required by OSFI, OSC, SEC, FACTCA, AML.
4. Increased the accuracy and timeliness of performance reporting, including attribution analysis, to clients
5. Allowed flexibility in reporting through the use of a data warehouse instead of using pre-programmed stock reports.
6. Enabled the implementation of a new client facing website eliminating the need to use a third party vendor.
7. Allowed STP trading and settlement at multiple custodians in multiple jurisdictions. Trading staff were able to focus on trading instead of trade settlement.
8. Introduced enhanced security features to align user access with securities legislation requirements.
9. Integrated the bank functions into the wealth management operations allowing clients to quickly access loan facilities
10. Decreased the amount of time that auditors spent during Cidel’s annual audit.

Our committed partnership with ERI implementing our OLYMPIC Banking System has led to this huge success for both companies. The solution has already been chosen by more than 300 financial institutions and banks worldwide. ERI with more than 30 years of expertise, also won the Best Banking System category for 2019 at the Systems in the City Financial Technology Awards (London, United Kingdom), out of 10,000 votes from across the industry and a total of 121 nominated companies.

As an example of the efficiencies obtained from using the new system, Cidel Asset Management has processed, for a single client, over 77,000 individual trades and settled the trades with multiple custodians. This entire operation was done without a single error or a failed trade. The error free implementation & strong investment performance gave the client confidence to increase his allocation to us in the succeeding months.

Cidel Bank Canada has over 175 employees in its offices in Canada and abroad and oversees over $14 billion of client assets.

Click to read the OLYMPIC Banking System Press Release.

During October, Cidel was joined by leaders in the Not-for-Profit (NFP) community for a virtual session on governance.

Our guest speaker, Don McCreesh, a Not-for-Profit (NFP) governance expert, was hosted by Cidel’s Christy DeCosimo and Catherine Jackman.

Many NFP organizations have faced increased stakeholder concern with governance policies and fundraising during the pandemic. Governance is more key than ever.

For Cidel it was a wonderful opportunity to celebrate the great work that these organizations do across Canada and elsewhere. It is a privilege for us to be involved with those who work so hard to build stronger communities which is near and dear to our firm culture.

Cidel is proud to contribute to worthy causes and even more proud of our staff who use their own time to volunteer.   Whether it is coaching hockey, serving meals at shelters or working on boards – we should all celebrate the great accomplishments and critical role NFPs play.

A big thank you to Don, to our attendees and to all the volunteers and staff at NFPs who are so dedicated to their missions.

Click here for the presentation.

Are you aware Canada has been ranked SECOND in Soundness of Banks by the  World Economic Forum?

We have the same value as Finland at the top spot!

See the full ranking of countries​.

Our Q2 2020 Quarterly Report is out!

This report covers topics including Cidel’s performance summary, non-profit organizations, award nominations and more. Enjoy!

Click here to read.

Our Barbados office sprang into action this month to help 250 vulnerable households.

Thousands of Barbadians have been impacted by widespread job loss due to COVID-19. Cidel Bank & Trust’s humanitarian project ballooned into a major partnership with the Lions Clubs of Barbados.

It was a matched donation and the substantial funds raised through the staff project was matched by Cidel Bank & Trust. This donation allowed for the purchase of essential food items, fresh fruits and vegetables, as well as personal care products for entire families. A special component of the initiative included the distribution of 12 electronic tablets for students in affected homes who required the devices to continue their education online.

Families were selected using the Lions Clubs’ registry of persons in need. Cidel employees were also asked to identify affected households whose main breadwinners had been laid-off during the national shutdown or worked in sectors that remain closed due to the halt in tourism and international travel. All of this was possible based on the help of Shonda Forde, a long-standing member of the Lions Club.

For Carol-Ann Smith, President of the Cidel Staff and Activities Committee, it was a satisfying moment as she joined other employees and Lions Club members preparing over 250 care packages. She added: “COVID-19 has shown us just how fortunate we are. We had great participation from all our staff and we are really pleased with the outcome.”

Ryle Weeks – President of Cidel Bank and Trust commented that“This is one of our biggest projects to date and we wanted, as a company to give back to our communities and demonstrate our commitment to this country. We are fortunate as a company because none of our employees have been impacted by jobs cuts. Our staff are still employed full-time and at full pay and we believe it was incumbent on us to share with others during this difficult time.”

View the full news story here.

We are honoured to receive, for a third year, the Chambers and Partners High Net Worth Award.

Cidel is considered by 2020 sources to be a “big player in the private client space.” One commentator describes it as “one of the best available in Canada,” while another highlights that “they have some good people working there and they are a go-to for investment and trust services.”

In an interview one person had this to say:

“They are my favourite, they stand out absolutely,” an interviewee enthuses; “I love to refer clients there, they give the best personal service and they provide help to clients all the way through. They are so responsive and thoughtful. They truly stand out to me, they are a leader for banking and trusts.”

We feel very proud of our achievements and will continue to provide great services​ to our clients.

Click here to read more.

We have been a proud sponsor of the YWCA Toronto Women of Distinction Awards for the past 3 years and as an event that raises a substantial amount of funds for the organization, we were saddened to learn that, due to this difficult and unprecedented time, it had to be postponed.  To help the organization meet the huge shortfall, Cidel, along with other event sponsors, moved forward with their sponsorships, as a 2020 donation to YWCA Toronto.

YWCA Toronto’s mission remains to provide safe and supportive spaces for the most vulnerable women and girls in Toronto.  The programs that would have directly benefitted from the funds raised still need support, and the added threat of COVID-19 has increased the need.

Please consider joining Cidel in the support of YWCA Toronto and Click Here if you are able to do so.

We are pleased to announce that our team has been nominated for The SIACharts Inc. Award for Digital Innovator of the Year​.

The awards process includes an industry-wide call for nominations, research, finalist submissions, and winner selection by a judging panel comprising independent experts in the wealth management and financial advice industries.​

We are incredibly excited to be recognized among the top in our industry by the Wealth Professional Awards. This event has been running 6 years and is the leading independent awards event for the wealth management industry.