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FAQ

Solus Trust wants to share the most frequently asked questions

Below you will find a few of the most frequently asked questions.
Should you have any other questions please send us an email at info@solustrust.com or give us a call at 604 683 5949.

FREQUENTLY ASKED QUESTIONS

  • Solus Trust is well-established.  Solus Trust was founded in 2005.  Since 2005, Solus Trust has served hundreds of Estate, Trust, Substitute Decision Making and Executor Assistance Agency clients in British Columbia.
  • Many decades of experience.  Solus Trust has over a dozen staff in BC with in-depth technical experience.  Solus Trust staff have more than 180 years of combined experience dealing specifically in the trusts and estate area.
  • Government Oversight.  Solus Trust Company is incorporated under the Financial Institutions Act (BC) and is regulated by the Financial Institutions Commission (FICOM), an agency of the Government of the Province of British Columbia.
  • Amongst the Largest Trust Companies in BC.  Practicing exclusively in the area of trust and estates, Solus Trust has grown to be amongst the largest trust companies in British Columbia.
  • Trust and Estate Services are our Core Product.  Solus Trust is employee-owned and singularly focused on providing trust and estate services only.  Over the last few decades Canada’s largest banks and financial institutions have entered and exited many different financial service-related businesses. It depends on which ways the markets blow.  A core service today, may not be strategic tomorrow.  In fact, over the past few decades a number of Canada’s largest financial institutions have shut down their trust company businesses, including HSBC and Vancouver City Credit and Savings Union (VanCity).
  • No conflicts of interest with Solus Trust.  Unlike larger organizations or multi-service banks, our staff do not cross-sell other products or services.  Our Trust Officers and Trust Administrators are focused solely on the delivery of quality service and we are located in British Columbia.
  • Independent / Non-Deposit Taking.  Solus Trust has no affiliation to big banks or investment firms.  This reduces the conflicts of interest traditional trust companies have when offering their own investment products.  It also allows client to continue to use their existing network of trusted advisors.

There are many reasons to appoint a professional, or corporate executor. A few reasons include:

 

  • There are no family members who live nearby, or who have the time and expertise to be Executor.
  • There is a child or family member who is physically or mentally challenged, has a substance abuse problem, or who struggles with money.
  • Client wishes to treat children unequally under their Will.
  • There are family members who do not get along.
  • Second marriage situation.
  • Protection of child’s inheritance against potential claims.
  • A complicated estate.
  • Existing chosen Executor is the same age or older than the Testator.
  • Estate Administration and tax expertise
  • Knowledge of estate and trust law
  • Availability
  • Financial accountability
  • Trustworthiness
  • Good judgement
  • Impartiality
  • Personal liability for mistakes
  • Criticism from family members/friends who disapprove of how estate is handled
  • Court challenges from family members excluded from or who perceive that they are inadequately provided for under Will
  • Conflict of interest where Executor is also beneficiary
  • Difficulty in administering estate due to location, lack of time or ability
  • Difficulty handling financial matters
  • Challenges of providing full and complete accounting to all beneficiaries
  • What if they should die during administration of estate………?
  • Adequate provision for proper maintenance and support of spouse and children must be
    made.
  • This includes common law, same sex partners and adult children.
  • If inadequate provision is made, the court can amend the Will.
  • This can be of particular concern in a second marriage situation.

There are many reasons to create a testamentary trust through your will upon death. A trust is an arrangement where money is placed in the hand of a trustee to us it for the benefit of someone else.

 

Testamentary trusts are trusts established in a will. They are often used to create ongoing benefits for spouses, minor and/or adult children and disabled beneficiaries.

 

A few such circumstances include:

 

  • Capital preservation, spendthrift trust, marriage breakdown
  • Minors trust
  • Second marriage trust
  • Disability trusts
  • Insurance trusts

There are many reasons to create an inter vivos trust during your lifetime. A few such circumstances include:

 

  • Same reasons as testamentary trust
  • Early estate distributions
  • Probate savings and wills variation avoidance
  • Family income splitting
  • Yes, usually the executor is appointed as trustee to manage estate money to be held for minor children.
  • The terms of the trust are spelled out in the Will.
  • The trustee pays out income and benefits to look after minor children.
  • When the trust ends, the executor (trustee) distributes the remaining estate.
  • The law permits a person by will to appoint a guardian of minor children.
  • One should consider appointing a different person as guardian than the person selected as executor.
  • The executor manages the estate funds, and pays them to the guardian for the child’s benefit.
  • If no guardian is named in your will, the courts will select a guardian on your behalf.
  • A Will is a legal document that allows you to divide and distribute your assets according to your wishes.
  • A Will exercises the legal freedom to leave the Will maker’s estate to people he or she chooses.
  • If you die without a Will (intestate), the courts will appoint an administrator to dispose of your assets according to a rigid legal formula. In other words, the law decides how and who will receive your assets regardless of your wishes or the needs of your family.
  • That is why a Will is so important. sets out the Will maker’s directions as to who should receive his or her estate upon their death.

Do you:

  • Have a spouse or common-law spouse?
  • Have any children?
  • Have any investments?
  • Wish to give money to a friend or charity?
  • Own a home or business?
  • Wish to pass along family possessions or heirlooms?

Of course, you may have other reasons for requiring a Will and your personal situation will determine this decision.

  • A Will must be in writing.
  • A Will must be signed by the Will maker, who must be mentally competent and at least sixteen years of age.
  • Signing of a Will requires the presence of two adult witnesses, both of whom must sign the Will in the presence of each other and the Will maker.
  • An executor is the person(s) or trust company the you appoint to carry out your wishes and settle your estate.
  • An executor can be any person who is at least nineteen years of age.
  • An executor can be and commonly is a relative or one of the beneficiaries. Spouses usually appoint each other as executor of each other’s estate.
  • The executor should be competent, capable of managing business affairs and someone
    trustworthy.
  • Duties may include making funeral arrangements, managing investments, paying any taxes and debts owing, filing tax returns and making distributions to beneficiaries.
  • In a large or complicated estate, consider the appointment of a trust company as executor.
  • The power to administer the estate and carry out duties should be set out in the Will. These powers are often set out in standard form in the Will (legal “boilerplate”).
  • The powers usually include the ability to preserve assets, deal with real estate, invest estate money and settle claims against the Will maker’s estate.
  • Executor powers should be broad and general.
  • The executor’s duties include: arranging a funeral, preservation of property, assembling and selling assets, paying taxes and debts, and distributing the Will maker’s estate as set out in the Will.
  • The first duties of the executor are to pay the Will maker’s debts, funeral expenses and any taxes.
  • The executor then distributes any special gifts of property and pays out cash legacies, if any.
  • Lastly, the executor sets up any trusts and distributes the residue of the estate.
  • Residue is the legal term used to describe what is left over in an estate, after payment of all taxes, bills, expenses, and distribution of any specific gifts.
  • A residue clause is necessary so that absolutely everything in the estate is properly distributed under the Will.
  • Residue usually comprises the largest part of the estate, for example “I leave the rest and residue of my Estate to my spouse …” or “to divide the rest and residue of my Estate equally among my children…”
  • Residue can be left to one person or divided into shares or percentages and given to a number of people.
  • There are good reasons to have more than one Will at the same time. For instance, if the Will maker owns property in a different jurisdiction it makes sense to set up a second Will that covers the laws in that jurisdiction.
  • For large estates, there may be savings possible by organizing the Will maker’s estate in different Wills.
  • Couples reflect their common intentions for their combined estates.
  • They first leave everything to each other.
  • On the death of the last to die, each Will contains identical provisions dividing the estate among their children and/or other beneficiaries.
  • After the death of one person, the survivor is free to make a new Will.
  • It is now becoming common practice to have an Enduring Power of Attorney prepared at the same time you have a will prepared.
  • This means that you can appoint someone to manage your financial affairs in the event that you are unable to.
  • You also need to appoint someone to make decisions on your behalf respecting your personal care and consent to treatment if you are unable to do so. This is known as the Advanced Health Care Directive.
  • Both appointments may be revoked at any time as long as you have the requisite mental capacity.
  • Estate Administration can take anywhere from a year or longer to conclude depending on the complexity of the estate assets and liabilities.
  • The executor while dealing with the beneficiaries and estate assets is also required by the Wills, Estates and Succession Act to hold the funds for 210 days after the grant of letters probate before making a distribution.
  • The executor deals with Canada Revenue Agency to obtain the necessary clearance certificates and this can also add to the time required in administering the estate.
  • Yes. You can name any number of Executors under your Will as long as they are over the age of majority.
  • No. There is no estate tax in Canada or Succession Duties in British Columbia. Depending on the size of the estate there may be probate fees to be paid.
  • The three important documents are, firstly, the Will to deal with your assets upon your passing.
  • Secondly, a Power of Attorney should you wish to allow a corporate trustee or individual to administer your assets, should you wish them to do so at any time, or should you become mentally incapacitated.
  • Thirdly, a Representation Agreement, or Advanced Health Care Directive to an individual(s) to attend to your physical care should you not be able to do so due to illness, accident or mental incapacity.

GLOSSARY

Accounts / Passing of Accounts
One of the official duties of any Trustee, Estate Trustee, Power of Attorney or Guardian is to keep
thorough records of how he or she managed assets. The passing of accounts is the filing of this record with a court in a highly-specific style and is required for Estates, Trusts, Powers of Attorney and Guardianships.
Alternate Trustee / Alternate Estate Trustee
An alternate Trustee or alternate Estate Trustee can be appointed in a Trust Deed, Will or Codicil and used as a back-up in case a Trustee or Estate Trustee becomes unable or unwilling to act. Appointing Legacy Private Trust as alternate Trustee or alternate Estate Trustee means that we can assist quickly if something comes up rather than having to wait to be appointed once a problem has already arisen.
Capital Beneficiaries
These types of beneficiaries are entitled to only the capital in the trust. This may become available to them at a determined time, sometimes after all the income beneficiaries have passed away or may be set aside for specific uses, such as education or the purchase of a first home. It is possible to be both an income beneficiary and a capital beneficiary.
Corporate Agent
A Corporate Agent is an Agent who is authorized to act on behalf of a corporation. This can be useful in a variety of ways and is most popular with domestic and offshore holding companies, but can be used in many other creative ways.
Discretionary Trust / Non-Discretionary Trust
A Discretionary Trust is a type of Trust where the Trustee excercises discretion with regards to decisions within the Trust. In this context, the Trustee has the duty to make responsible decisions using good judgement with regards to occurances such as a distributions to a beneficiary. In a Non-Discretionary Trust, the Trust Deed specifically outlines the nature of the Trust. In this context, the Trustee must follow the deed to the letter.
Estate Freeze
An estate freeze is an estate planning tool that is used to defer income taxes to a later date by limiting capital gains that are realized just before death. By using a trust, you can retain control of your capital property during your life and provide for future growth in the property to be transferred to someone on your death.
Fiduciary
A fiduciary is a person that is entrusted with managing another’s money or property. A fiduciary must exercise a high standard of care and act in good faith and only for the benefit of beneficiaries. Legacy Private Trust takes on a fiduciary role by acting as Trustee, Estate Trustee, Agent, Guardian or Custodian.
Guardian for Personal Care & Health
In conjunction with a Guardian for Property, a Guardian for Personal Care & Health looks after the non-property related decisions for someone deemed unable to do so. These decisions can range from responsibility for parenting children to helping adults make day-to-day decisions. Legacy Private Trust does not accept appointments as Guardian for Personal Care & Health.
Income Beneficiaries
These types of beneficiaries are entitled to receive only the income earned on the capital in the trust. A trust deed may provide for them to receive capital in certain situations.
Power of Attorney
A Power of Attorney is a legal document that gives someone else the right to act on your behalf. This type of fiduciary appointment involves naming a person to make decisions for you when you are no longer able to do so for yourself. An appointment of an Attorney under a Power of Attorney is used in anticipation of sudden changes in circumstances and is used in combination with a Will and trusts to create an overall estate plan.

We can be appointed as your Power of Attorney for Property in several ways:

Continuing Power of Attorney for Property – We can manage and administer your financial affairs now and later on if you become incapable of doing so yourself

Limited Power of Attorney for Property – This can be established for a short period, such as managing property while on an extended vacation

There is another type of Power of Attorney: a Power of Attorney for Personal Care & Health. However, since this is more appropriate for family members and friends, we do not accept these types of appointments at Legacy Private Trust. Appointing an Attorney for Property is a type of Agency appointment.

Settlor
A settlor is the person who creates a trust. The settlor contributes the assets which become the
property of the trust. A settlor must be an adult in his or her jurisdiction, must not be legally restricted and must be mentally competent. A Settlor can also be a beneficiary in many circumstances.
Trustee / co-Trustee / Alternate Trustee
A Trustee is the individual or trust company who holds the assets and administers them for the benefit of another in accordance with the wishes of the settlor. A co-Trustee is someone who acts together as Trustee with another individual or trust company. An alternate Trustee appointment avoids you having to deal with a Trust having no Trustee in the event that a Trustee becomes unable or unwilling to act.
Will
A Will is a document that indicates one’s wishes on passing away, including how one’s assets are to be distributed. It can include appointment of Guardians and the establishment of any trusts or foundations. Specific Estate Trustees are named in a Will and their responsibility is to carry out the deceased’s wishes set out in the Will.
Agent
Someone who is authorized to act for or in place of another; a representative. An Agent acts with
varying levels of consent given to him or her by the other person. Legacy Private Trust is happy to act as Agent for anyone appointed Trustee, Estate Trustee, Guardian, Custodian or for a Foundation. The provision of agency services to an Estate Trustee is often referred to as executor services.
Beneficiary
A beneficiary (sometimes referred as an heir) receives assets from a person’s estate or from a trust (this includes Guardianships, Foundations and Custodian arrangements). These assets are distributed in accordance with a Will, Codicil, Trust Deed, court order, management plan or other agreement. Beneficiaries may receive an income stream or a capital sum and have the absolute right to receive the assets. These could be spouses, children, grandchildren, other family, friends or even long-time employees, business owners, companions or charities.
Codicil
A codicil is a document that amends, modifies or clarifies a Will in some way. This is a way to make slight adjustments to your Will without having to re-draft it in its entirety. Codicils are often used to change Estate Trustees, Trustees and beneficiaries.
Custodian
A Custodian is a form of an agency appointment where a person or institution such as Legacy Private Trust cares for or controls the assets on behalf of another. A Custodian appointment is often used for foundations.
Escrow Agent
An Escrow Agent is used as a third party Custodian when assets are being transferred from one party to another. There are always conditions which must be met by one or more of the parties involved before the assets can be released. Escrow Agents can be used in many ways, but they are often used to distribute the proceeds of settlements or the sale of a business. At Legacy Private Trust we can take on the administrative responsibility of managing and distributing the assets as a Escrow Agent.
Estate Trustee / co-Estate Trustee / Alternate Estate Trustee
An Estate Trustee (traditionally known as an executor) is someone who carries out or executes the
provisions of someone else’s Will or Codicil. This can involve over seventy separate tasks and can take a minimum of 1 year to sometimes several years before an estate is distributed fully, depending on the complexity. If your estate ends up in litigation, it may take even longer to administer it. Acting as an Estate Trustee requires a high level of legal, tax and accounting expertise. A co-Estate Trustee is someone who acts as Estate Trustee along with another person or trust company. An alternate Estate Trustee steps into the job in the event that the acting Estate Trustee becomes unable or unwilling to act.
Foundation
Private foundations are set up by an individual, a family or a group of individuals for charitable giving and can be administered by Legacy Private Trust by appointing us as Agent. The Legacy Private Trust Foundation is a great option for those who do not wish to establish their own foundation, for those who need time to establish their own foundation but want to receive tax benefits immediately, for those who would like to remain fully anonymous in their giving and/or for those who wish to make a direct contribution (with tax receipt) which will be directed by the Foundation’s Board of Directors.
Guardian for Property
A Guardian for Property is a person who has the legal authority and the corresponding duty to care for the property interests of another person. Usually, a person requires a Guardian because he or she is incapable of caring for his or her own property interests due to infancy or incapacity.
Income Splitting
Income splitting with a spouse, often done through a trust, can reduce the amount of total tax paid by a couple by pooling their income and putting both of them in the same, lower tax bracket. This can lead to a lower combined tax bill and can reduce or eliminate Old Age Security claw backs.
Probate / Probate Taxes
Probate is the process of getting the court to rule that a Will is legally valid. In order to move forward with most estate administration, an application for probate must be filed with the court and what may be significant probate taxes must be paid. These probate taxes can be quite high, but they can be minimized significantly by developing a comprehensive estate and trust plan with your lawyer and an experienced Trustee or Estate Trustee like Legacy Private Trust. Probate taxes are now commonly known as Estate Administration Taxes.
Trust
A trust is a relationship that exists whenever a person called a Trustee holds property for the benefit of another known as a beneficiary. The specifics on the administration of a trust are outlined in your province’s legislation. The person who creates or settles a trust is referred to as the settlor in the trust relationship.

Trusts are used to determine how assets are distributed during one’s lifetime or after passing away. They are a tool used to transfer wealth between generations and to make provisions for a spouse, minor or adult children and non-family members such as long-time employees, companions, friends or charities. Other benefits of a trust are a reduction in probate taxes, confidentiality of assets and beneficiaries and protection of your estate from creditors.

Trust Deed
A Trust Deed is also known as a Trust Agreement or Trust Indenture and is a document that outlines the terms of a fiduciary relationship between the settlor, Trustees and the beneficiaries. The deed outlines the manner in which assets are to be distributed to beneficiaries.

Solus Trust is located at 520 – 1100 Melville Street – Vancouver. There is an available parking in building with access from Melville Street.

CONTACT US

Solus Trust looks forward to hearing from you and welcomes any inquiries you may have.

OFFICE HOURS
Monday – Friday
9am – 5pm
ADDRESS
520-1100 Melville Street
Vancouver • BC • V6E 4A6
Canada