Estate Lawyer
Joanna Ringrose

Joint Asset Planning


In planning for the eventual disposition of their estate, it is common for people in Ontario to employ various means to try to avoid the payment of Ontario Estate Administration (probate) Taxes.  One particular method frequently suggested by well-intentioned advisors is for individuals to put assets into joint names with one or more of their adult children.

Lawyers have long struggled with this issue and have often warned clients about the potential risks of holding assets in joint ownership with adult children.  One writer has identified some of these risks for his clients by referring to them as the “Five Ds” or the “Five Dangers” of transferring property into joint ownership (without first seeking legal advice)*:  

DISASTER

Joint owners can refuse to cooperate when one needs to deal with the property (i.e. one must have the consent of the joint owner to sell or otherwise deal with the jointly owned asset).

DEATH

The adult child may die before the parent, or the transferror and transferee may die in a common accident.

DIVORCE

An estranged spouse of the adult child could make a claim against the jointly held property.

DEBTS

Creditors of a bankrupt joint owner could make claims against the jointly held property.

DISPOSITION (FOR INCOME TAX PURPOSES)

Tax problems can arise as a result of a “disposition” occurring for income tax purposes and capital gains taxes becoming payable.  Principal residence exemptions can be lost or reduced when real estate is registered in joint names with an individual who already owns a principal residence or subsequently acquires one.

While this list is not exhaustive, it highlights some of the important risks.


For more information, contact Joanna at:

    (905) 844-5021



(Important note: These comments and all comments on this website are provided for general information purposes only and should not be construed as legal advice. The reader should seek and specifically retain an estates lawyer before acting on this information.)




Providing legal services in Oakville, Burlington, Mississauga, Toronto, and the rest of the GTA.


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