Wills with Foreign Assets — Cross-Border Estate Considerations for Canadians
Canadians with foreign assets face specific Will and estate planning challenges that domestic-only estates don't. This guide covers the basics; for substantial foreign assets, professional cross-border advice is essential.[2]
What's a 'foreign asset'
Anything located outside Canada or governed by foreign law:
- US real estate (vacation home, rental property, investment property)
- Foreign bank accounts
- Foreign investments (stocks, funds in foreign brokerages)
- Foreign business interests
- Foreign insurance policies
- Pensions from foreign employment
- Specific to country and asset type
The two governing law rules
Real estate (immovable property): Governed by law of country where located (lex situs).
Movable property (bank, investment, personal property): Generally governed by law of testator's domicile.
Practical effect: Your Canadian Will governs your Canadian movable assets and foreign movable assets, but US real estate is governed by US state law where located.
Single Will vs separate Wills
Single global Will
Covers all worldwide assets. Executor must obtain probate in primary jurisdiction (Canada) plus ancillary probate in each foreign jurisdiction where the deceased held real estate.
Advantages:
- Simpler drafting
- Single document to update
- Clear unified intent
Disadvantages:
- Cross-border execution complex
- Probate delays
- Multiple jurisdictions' fees
- Translation may be required
Separate Wills per jurisdiction (situs Wills)
A Will for each major jurisdiction. Canadian Will for Canadian assets; US Will for US assets; UK Will for UK assets.
Advantages:
- Each Will administered in its own jurisdiction
- Faster local execution
- No cross-border translation issues
- Specific local tax planning possible
Disadvantages:
- Multiple documents to keep updated
- Coordination risk (overlapping provisions, conflicting executors)
- Higher upfront cost
- Need lawyer in each jurisdiction
Specific to US assets (most common for Canadians)
US-situs assets for Canadians often include:
- US real estate (Arizona, Florida vacation homes especially common)
- US bank accounts
- US brokerage accounts (Schwab, Fidelity, etc.)
- US LLCs
Tax implications:
- US estate tax applies to US-situs assets of non-residents (treaty exemption pro-rated)[1]
- Canadian deemed disposition still applies
- US-Canada tax treaty provides certain protections
- Federal estate tax exemption around US$15M (2026); Canadian residents get pro-rated portion
Common structures to simplify:
- US Will for US assets
- US LLC owning US real estate (avoids ancillary US probate)
- Cross-border irrevocable trust
- Joint tenancy with US-resident family (specific tax implications)
Specific to cross-border tax specialist — substantial US assets warrant specific planning.
Documentation for executor
Comprehensive foreign asset inventory:
- Country and jurisdiction
- Type of asset
- Institution and contact information
- Account numbers (or location of records)
- Currency and approximate value
- Access mechanism (passwords, codes, agent locations)
- Tax treatment expectations
- Specific local legal counsel contacts
The Life Discovery Kit approach is particularly valuable for foreign assets because executors typically have limited awareness of what exists abroad.
The T1135 reporting obligation
Separate from what happens at death, Canadian residents who hold specified foreign property with a total cost above $100,000 CAD at any time in the year must file Form T1135, the Foreign Income Verification Statement, with their annual tax return.[3] Specified foreign property includes foreign bank accounts, foreign investment accounts and brokerage holdings, and foreign real estate held for investment or rental income (a foreign property used personally, like a vacation home, is generally excluded as personal-use property). This is a lifetime compliance obligation, not a probate one, but it matters to the estate plan in two ways. First, the deceased's final T1 return still needs a T1135 for the year of death if the threshold was met. Second, if foreign property is retained by the estate or transfers to a beneficiary who becomes its owner, the T1135 filing obligation can continue for whoever holds it. Noting which foreign holdings were already T1135-reportable — and where past filings are kept — is a practical addition to the foreign-asset inventory described above.
Specific recognition issues
Some foreign countries:
- Don't recognize foreign Wills without specific procedures (notarization, apostille)
- Require local Will format
- Have forced heirship laws (specific portions must go to family regardless of Will)
- Have specific religious or cultural inheritance rules
Forced heirship is especially common in:
- France, Spain, Italy, Portugal
- Latin American countries
- Specific Middle Eastern jurisdictions
A Canadian who has assets in a forced heirship country may find that the Canadian Will's wishes are partially overridden by local law.
Practical recommendations
For most Canadians: If foreign assets are modest (under $100K-200K total foreign), single Canadian Will with proper documentation often sufficient.
For substantial US assets: Consider US Will or US LLC structure. Cross-border tax specialist consultation.
For complex multi-country assets: Multiple situs Wills with coordination through estate planning lawyer.
For all situations:
- Document foreign assets comprehensively
- Designate beneficiaries on foreign accounts where possible (passes outside Will)
- Update as assets change
- Specific professional consultation for complexity
What we focus on at It's Simple Will
The Will Creator handles Canadian Wills covering Canadian assets primarily. For substantial foreign assets, consultation with a Canadian estate lawyer familiar with cross-border issues and potentially a foreign legal counsel is appropriate.
Related guides
Citations & sources
- [1]Canada Revenue Agency — Non-residents and deemed residents — Canada Revenue Agency
- [2]Canadian Bar Association — Wills, Estates and Trusts — Canadian Bar Association
- [3]Canada Revenue Agency — Foreign Income Verification Statement (Form T1135) — Canada Revenue Agency
Frequently asked questions
Does my Canadian Will cover US property?
Generally yes, but US-situs real estate requires US probate (ancillary probate) which can be complex and expensive. Many Canadians with US property use a separate US Will or other US-specific structures (LLC, cross-border trust) to simplify.
What's a 'situs Will' or separate Will?
A Will specifically for assets in a particular country. Canadian Will covers Canadian assets; US Will covers US assets; UK Will covers UK assets. Each governed by its own jurisdiction's rules. Specific drafting required to ensure they don't conflict.
What about US estate tax for Canadians with US property?
US estate tax applies to US-situs assets of non-US-residents. Significant exemption thresholds apply (US$15 million federal for 2026; Canadian residents benefit from Canada-US tax treaty pro-rated exemption). Specific cross-border tax planning may apply. Consult cross-border tax specialist for substantial US assets.
What about foreign bank accounts?
Movable assets (bank accounts, investments not real estate) are generally governed by the law of the testator's domicile (Canada). Foreign bank accounts can typically be transferred to estate per Canadian Will, but require local procedures in foreign country. Specific to each foreign institution.
How do I document foreign assets for executor?
Comprehensive inventory in Life Discovery Kit or equivalent — account details, contact information, access mechanisms, currency, approximate values. Foreign asset complexity is often the biggest executor burden; documentation reduces it significantly.
Should I use one global Will or separate Wills?
Trade-offs. Single global Will simpler but cross-border execution complex. Multiple Wills (situs Wills) faster local execution but coordination risk. Threshold typically — substantial foreign assets (>$200K-500K per jurisdiction) favours separate Will. Specific professional advice warranted.