When a person dies the CRA considers that the person has disposed of all their property right before death, it is what is known as a “deemed disposition”. The parties who inherit the property(ies) are considered to have deemed proceeds. As a result, there could be tax consequences and the CRA may request an appraisal by a real estate valuation professional.
Probate is a process that verifies a will is real under B.C. laws. Whether a will needs to be probated or not depends on the agencies and financial institutions that hold assets within an estate – they may require that a will is probated before the assets are distributed or accessed by anyone. A real estate appraiser can be hired to value these properties if the properties are to be split between beneficiaries and if one party has agreed to buy out the other(s).
Net Worth Estimate
When individuals, families or corporations invest in multiple types of real estate (primary residence, annual rentals, air BB;’s, apartment buildings, commercial strata, etc) it is often important for their accountants to have a good understanding of the current market value of these properties and the individuals total net worth. It is recommended to hire a professional appraiser to give a precise value as of a certain date, as opposed to using a dated sale price, assessment data or a realtors opinion may be considered less reliable by the Canada Revenue Agency.