Key points
- At death, capital property is generally treated as sold and RRSPs and RRIFs are generally income, unless they pass to a spouse or partner.
- Probate fees differ sharply: BC charges by the value of the estate, Alberta a capped fee by bracket.
- Life insurance, TFSAs and RRSPs with a named beneficiary generally pass outside the will.
- Life insurance is often used to pay tax at death or to leave an inheritance without selling assets.
- Your lawyer drafts the will and powers of attorney; we cover the tax; a licensed agent covers insurance.
Tax at death
- Deemed disposition. Just before death, capital property (investments, a cottage, a rental, private company shares) is generally treated as sold at fair market value, and the gain is taxed on the final return.
- Spouse or partner rollover. Property left to a surviving spouse or common-law partner, or a qualifying spousal trust, can pass with the tax deferred until they sell it or die.
- Registered plans. RRSPs and RRIFs are generally included in income at death, unless they pass to a spouse or partner, or in some cases a financially dependent child or grandchild. A TFSA isn't taxed at death; growth after death can be.
- Principal residence. A home designated as the principal residence for every year owned is generally free of tax on the gain.
Probate in BC and Alberta
Probate is the court process that confirms a will. Its fees apply to assets that pass through the estate. In British Columbia the fee is set by the Probate Fee Act and rises with the estate's value: no fee on the first $25,000, then $6 per $1,000 to $50,000 and $14 per $1,000 above that. In Alberta the Surrogate Rules set a fee by bracket, from $35 to a maximum of $525. Assets with a named beneficiary or held jointly with right of survivorship generally pass outside the estate. Our estate planning guide has worked examples.
Where insurance fits
- Paying the tax. A policy, often permanent or joint last-to-die, can provide cash for the tax on the final return so the family doesn't have to sell a cottage, a rental or the business.
- Equalising an inheritance. When one child takes over the business or the cottage, insurance can provide an equal share for the others.
- Naming beneficiaries. A named beneficiary receives the death benefit directly, without probate. A minor can't receive it directly, so a trustee or trust is usually named. Check designations after a marriage, separation, birth or death.
- Business owners. See partner and shareholder life insurance and tax planning with insurance.
Where Finvo fits
We estimate the tax your estate may owe, look at your RRSP, TFSA and insurance beneficiary designations with you, prepare the final return and the estate's T3 returns, and work alongside your lawyer, who drafts the will. We are not lawyers and give no legal advice.
Finvo itself does not sell insurance or give insurance advice. Finvo can connect you with a licensed insurance agent from our partner network who can help with insurance advice if you need it. The licensed agent advises on products and coverage; Finvo covers the tax side. Insurance and other specialists are joining Finvo as contractors, so a group of consultants can work on your file together and you don't have to go from place to place.
Whoever you deal with, you can check that an agent is licensed: in British Columbia with the Insurance Council of BC licensee directory, and in Alberta with the Alberta Insurance Council agent lookup.
This page is general information, checked against the sources below on 5 Nov 2026. Every policy and plan has its own terms; it isn't insurance, tax, investment or legal advice for your situation.