The $10M Tax Bill When a Business Owner Dies

Welcome to Episode 4 of Advisors Table

In this episode, we walk through a real client scenario that highlights the risks of taxes on death and corporate structure planning. Learn how poor planning can lead to rushed asset sales and lost value, and how careful structuring can protect families and businesses.

In this episode, we cover:

How taxes on death are calculated in Canada
Risks founders face when planning is delayed
Hidden tax and probate exposure
What purification is and why it matters
Estate freezes and family trust strategies
Lifetime capital gains exemptions and maximizing them
Post-mortem tax - double and triple taxation after death
The importance of updated wills, trustees, and replacement trustees
Executor risk and the importance of CRA clearance certificates

💡 *Take action now:* understand your options, plan effectively, and protect your family and business from unexpected tax surprises.

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00:00 - Introducing the Case Study: Robert's $10 Million Tax Bill
02:30 - The Discovery Phase: Gathering Financial Information
04:40 - Understanding Family Dynamics and Objectives
07:45 - The Role of the Executor and Estate Administration
11:10 - The Liquidity Problem and Fire Sales of Assets
14:30 - Probate Fees and the Ontario Estate Administration Process
18:30 - Exploring Estate Planning Options: Gifting vs. Estate Freeze
22:30 - The Family Trust as a Flexible Tool for Control and Growth
26:30 - Trustees, Beneficiaries, and the 21-Year Rule
31:00 - Addressing Non-Resident Beneficiaries and Tax Implications
35:30 - Lifetime Capital Gains Exemption and Purification Strategies
40:30 - Updating Wills and Using Primary/Secondary Will Strategies
44:30 - Life Insurance as a Liquidity Solution for Tax Liabilities
48:30 - Uncovering Delinquencies: Foreign Reporting and Minute Books
52:30 - The Clearance Certificate and Finalizing the Estate
56:30 - The Problem of Double or Triple Taxation on Death
01:01:30 - Post-Mortem Tax Planning: Pipeline, Bump, and Loss Carryback
01:05:30 - Creating a Summary for the Executor and Ongoing Adviser Coordination
01:10:00 - Final Thoughts: Estate Planning as a Collaborative, Essential Process