Fact checked

This content has been reviewed by Canadian estate planning experts or legal professionals. Our editorial team is committed to ensuring the accuracy and currency of content related to estate planning, online wills, probate, powers of attorney, guardianship, and other related topics. Our goal is to provide reliable, up-to-date information to assist you in understanding these complex topics.

Beneficiary Basics

In this article:

    The beneficiaries section is one of the most important in a last will and testament. It outlines which individual(s) or organization(s) you would like to gift your assets, whether that’s money, property, or sentimental assets. 

    What is a beneficiary?

    The formal definition of a beneficiary is any person who gains an advantage and/or profits from something. In the financial world, a beneficiary typically refers to someone eligible to receive distributions from a trust, will or life insurance policy.

    The beneficiary or beneficiaries outlined in your will are the individuals who you choose to pass on your property or belongings to when you are no longer living.

    When and why would I need to name a beneficiary (beneficiaries)?

    When making your will, you should absolutely name a beneficiary or beneficiaries regardless of the estimated value of your assets and belongings. This is your chance to distribute assets, cash, or gifts that you would like to pass on to important individuals, charities or organizations in your life. Note that a beneficiary does not have to accept a gift arising either by way of a will or intestacy – they are able to disclaim it. 

    We’ve outlined the various reasons you would name a beneficiary below. 

    Passing on specific gifts

    Specific gifts, also known as a devise (historically describes a gift of realty – aka real estate) and bequests (historically describes a gift of personalty, or property that isn’t real estate), are identifiable pieces of property or monetary amounts gifted to individuals upon your passing. These gifts are not included in your residual estate.

    Before outlining Specific gifts in your will, we recommend going around your home and creating a list of specific items and that you’d like to include in the will. In doing so, you will avoid having to think through all of the items on the spot, which can be overwhelming.

    Some common gifts include:

    • Real estate: For example your primary residence, summer home, cottage
    • Lump-sum sash gifts, sometimes intended for a specific purpose such as education
    • Jewelry, art, clothing, cars
    • Heirlooms or mementos with special meaning (like a book of recipes, or photographs)

    Leaving charitable donations

    Charitable donations, also known as legacy gifts, can be given in two ways. First, you can leave a lump-sum cash amount to an organization of your choice. These gifts are given separately when you pass away, and are not included in your residual estate. Instead, or in addition to this method, you may leave a percentage of your residual (remaining) estate to a charity. The organization will receive the cash value of distribution you gave them from your overall estate.

    Splitting up your residual estate

    Finally, after Specific Gifts and Charitable Donations, you should determine who (or which organization) will receive your residual estate. Also called the “residue”, this includes all personal property of value not otherwise distributed. It can be thought of as an umbrella that covers your every asset: from real estate you may own, to a gold watch, to an amount of money in a bank account.

    Think carefully about the beneficiary (or beneficiaries) of your residual estate, as this often forms the largest financial component of an estate. It is very important that there is a clause in your will dealing with which one or more beneficiaries the “residue” of your estate would go to, because if not, whatever assets comprise the residue will be distributed according to the laws of intestacy. 

    Who can I name as a beneficiary?

    Many Canadians choose family members or loved ones; however, a beneficiary can also be a charity or organization that is meaningful to you. Below we have outlined a list of individuals that people commonly choose as their beneficiary or beneficiaries.

    Your spouse: Married couples often choose each other as the primary beneficiary of each others’ estates, which is a common scenario known as a ‘mirrored will’. 

    Similarly, Common-law spouses often choose each other as the primary beneficiaries of their wills. Common law spouses do not automatically have the same property rights under the law as married couples, so it’s even more important that this desire be recorded.

    Your children: A child or children  born to you— including those from a prior marriage or legally adopted by you - are eligible to be named as your beneficiary. Although by law stepchildren are not legally considered your children, you can, of course, leave property to anyone you desire including your stepchildren.

    A minor: You can leave gifts, assets, and property to minors in your will, but keep in mind that the minor will not be able to receive or control any property. Please see the section on minor beneficiaries and their guardians.

    A charity or organization: Choosing a charity or organization to leave some or all of your assets is another popular option. It will be the responsibility of your executor to carry out your wishes accordingly. 

    Other beneficiaries: Friends, neighbours, loved ones, someone who showed you memorable acts of kindness— anyone important to you can be named a beneficiary in your will.


    Provincial law has upheld that testators (i.e. you – the person making the will) may owe a financial obligation to their spouse, children, and other dependents such as parents and grandparents, or brothers and sisters of the deceased . If you plan on excluding these persons entirely from your Will, you should seek independent legal advice.

    How do I name my beneficiaries?

    For clarity, always use first, middle and last names for people you name as beneficiaries. Also, it is best to use the formal name of any Charity or Foundation you wish to leave funds to, and to include the Charity Registration number (CRA registration number for Canadian charities) – Willful makes it easy to find that information via CanadaHelps.

    After specific gifts and charitable donations, you can choose one primary beneficiary and leave your entire Residual Estate to them; or you can divide your remaining estate among multiple beneficiaries in your will, leaving them each a portion. You can split your residual estate equally, for example: 50% to each child, or unequally, for example: 30% to your sibling and 70% to your parent.

    Can I name zero beneficiaries? What happens then?

    Choosing a beneficiary is not legally required in your last will and testament; however, it is not an optional section on the Willful application. By creating a will, you are helping your family, friends, and executor navigate difficult decisions after you pass away. Dividing your assets is a crucial part of that, and making decisions ahead of time will avoid conflict for them later.

    If you do not name any beneficiaries in your will, provincial law will determine who receives the property in your estate, and it may not be distributed as you would have intended.

    Can I leave cash or property to a charity? How would that work?

    Willful provides a list of Canadian registered charities you may want to leave a gift to, and also allows you to enter your favourite organization if it’s not on our list. If you decide to name another organization or charity, we recommend finding their formal name and business registration number (CRA number) for inclusion in your Will. An excellent resource for finding information on charities, and to donate while still alive is CanadaHelps.

    When you pass away, it will be the responsibility of your executor to distribute any assets or gifts to the charity or organization of your choice.

    What if one or more of my beneficiaries are minors? Should I leave money to their guardians too?

    You can leave gifts, assets, and property to minors in your will, but keep in mind that the minor will not be able to receive or control any property immediately. Their share will be held in trust by the estate trustee until they reach the age of majority, or another age detailed in the will. Prior to that time, their legal guardian will be able to access funds for the maintenance, care, and education of the minor, at the discretion of the estate trustee. If there is no trust to hold the assets for the minor beneficiary, deposit the assets with an accountant of the Ontario Superior Court of Justice to credit the minor with notice to the Office of the Children’s Lawyer.

    On Willful, you may delay the minors receipt of their inheritance to the age of majority, or twenty-one, or twenty-five. Note that even where you specify an age other than majority, there is a rule that allows a person who is sui juris (meaning mentally capable and over the age of majority) and is solely interested in property, which has vested in him or her absolutely, to demand a conveyance or transfer of the property having reached the age of majority. 

    The estate trustee may have duties such as dealing with investments for the minor, collecting debts, paying bills, or distributing funds to their guardians.

    I want to fully exclude a spouse, child, or another dependent from my Will, can I still use Willful?

    You can choose to exclude a spouse, child or another dependent from your will - disinheritance can be triggered by a specific event or strained relationships or estrangement.

    Provincial law has upheld that testators (i.e. you – the person making the will) may owe a financial obligation to their spouse, children, and other dependents such as a parents and grandparents, or brothers and sisters of the deceased . If you plan on excluding these persons entirely from your will, you should seek independent legal advice.

    What happens if a beneficiary predeceases me?

    If one of your beneficiaries dies before you, in the Willful platform you can choose for the estate to go directly to their children, or the estate can be divided among your other named beneficiaries. Willful is also adding the ability to appoint specific backups for each beneficiary in case one passes away before you (you can also update your will if one of your beneficiaries passes away by removing them and adding a new beneficiary). 

    It is important to do this, because otherwise, the gift will lapse and be added to the residue, and if there is no beneficiary for the residue to flow to, the residue will default to intestacy laws. Splitting the benefit by designating two or more beneficiaries can reduce this risk. Another option would be to create a contingent beneficiary, which you can also do in the Willful platform.

    In Ontario, anti-lapse legislation exists, which allows for a lapsed gift – a gift that couldn’t be given to the chosen beneficiary so it’s placed back in the residue - to go to the spouse or child of the deceased beneficiary. It’s important to note that this only applies in situations where the deceased beneficiary had a close relationship with the testator (for example, they were a child, grandchild or sibling of the testator). 

    What is a contingent beneficiary?

    A contingent beneficiary is a person or charity you designate to receive your estate in case all of your primary beneficiaries are unable to inherit your estate - think of it as the ultimate backup beneficiary. Willful allows you to appoint as many contingent beneficiaries as you'd like.

    An example of this would be if you named your spouse and child as your beneficiaries, and the three of you were in an accident and passed away together. In that scenario, your contingent beneficiary would receive the entire estate. But if you passed away while your spouse and child were still alive, they would receive your estate as planned, and the contingent beneficiary would receive nothing.

    Life is full of twists and turns and there are a lot of tough scenarios to imagine. Regularly review your estate planning documents to make sure all those who are named are still alive to avoid any future confusion.

    Who is a legitimate beneficiary?

    While there was once a distinction between children born in/out of wedlock, reference to a person (in terms of relationship to another person determined by blood or marriage) includes those born out of wedlock. It also includes for offspring conceived and born after the death of the individual, as per section 2 of the Children’s Law Reform Act in Ontario.

    The estate trustee is obligated to make “reasonable inquiries” for persons who may be entitled to inherit by virtue of a relationship traced through a birth outside marriage. However, the estate trustee is not liable for failing to distribute assets of an estate to a person born outside marriage if he/she made inquiries and the person is not known to the estate trustee, despite searching in the records of the Registrar General for Ontario relating to parentage, but no success. Sometimes testators will include a provision excluding someone born outside marriage from inheriting to prevent the possibility of false claims. Unfortunately, this is not currently an option that Willful offers. 

    Finally, legally adopted children are treated as if they were born of adoptive parents, meaning that they inherit from adoptive parents and are disentitled from their natural parents.

    What happens to interest earned on property held in trust before it’s paid out to my beneficiaries?

    Where the testator’s will provides that certain assets are to be held in trust, the trustees of such trust are normally required to invest those assets – even if there is no direct or express direction to accumulate the income, there is usually an implied direction that the income be accumulated. Depending on the nature of the trust assets, they may generate interest. There is a rule against accumulations that prevents someone from re-investing the interest earned from the capital of a trust property, rather than distributing it, for a period longer than 21 years. In Ontario, according to section 1(6) of the Accumulations Act, any income earned beyond the accumulation period goes to the residue of the estate or is distributed on intestacy. 

    To avoid offending this rule, you can specifically provide in the will for the distribution of any income that continues to be generated from the trust assets after the accumulation period ends. Willful does not currently allow customers to specify distribution. 

    Is there ever a case where beneficiaries don’t receive money or assets?

    While you can’t pass on debt in Canada, your estate is responsible for paying off your debts when you pass away – so if you’ve assigned three beneficiaries, and your debts are more than the total value of your estate, there’s a risk they won’t receive anything. 

    Abatement refers to what happens when the estate assets don’t cover the debts owed by you, and how that proportionately affects the amounts or quantities of gifts. Debts must be paid before beneficiaries have entitlement to gifts. If there are insufficient funds to pay creditors, creditors are paid in order of priority. If there are sufficient funds to pay creditors but not to satisfy the gifts in full, then some of the gifts will have to abate (be paid out proportionally). The primary fund to pay debts is the residue of the estate, then you will look to the general gifts, and then finally to specific gifts.

    The abatement of gifts in each category will occur in equal proportions so that no single beneficiary will be made to bear the full burden of the abatement, although your specifically expressed intentions always override the rules of abatement.

    What if the gift is no longer in existence at the time of death?

    Ademption occurs when property that is the subject matter of a gift in a will, which was in existence at the date of the will, is no longer part of your estate at the time of death – for example maybe you left your brother a car in your will, but you sold it prior to passing away. The gift is said to adeem, and your beneficiary gets nothing. There are a number of different circumstances in which you can avoid a gift adeeming.

    The next few paragraphs are full of legal language, but they help you understand cases in which a gift you left that had changed by the time of your passing may still be given out. 

    The cy-pres doctrine is a legal doctrine that allows a court, on application, to make a substitutionary gift to a charity that carries on charitable activities similar to those contemplated by the testator. In this way, the gift will not adeem or fail and will instead be granted to an alternate charity. For a court to exercise its jurisdiction to apply the cy-pres doctrine, two things must be established: 1) that it is impossible or impracticable to carry out the deceased’s intention and 2) that the deceased, in making the gift, had a general or overriding charitable intent. 

    Where there is just a change in name or in form, but the specific property is substantially the same, then the gift would not adeem. For example, if you leave “50 shares of Business X” to your beneficiary and by the time of your death you now own 150 shares, your gift is substantially the same, so it will not adeem.

    Tracing occurs where you, the testator, leave a beneficiary the proceeds of a sale of certain property and not the gift of the property itself. However, the gift would adeem in a situation where you had cashed the deposit and clearly appropriated the proceeds to yourself (no longer traceable). 

    Where you have sold or otherwise disposed of property that was the subject matter of a gift in the will, the testator has converted the property into other property, and the original gift in the will adeems, as per the equitable doctrine of conversion. Even where a sale of the property is not yet concluded, but you have entered into an agreement to sell it, such that the property itself is still in the estate of the deceased, the gift will adeem. If the deal does not close following the death of the testator, the beneficiary will be entitled to receive it.  

    What are conditional gifts?

    There are a number of types of conditions that can be imposed on gifts – see below for an explanation of what these conditions are. While Willful does not offer the option to create conditional gifts at the moment, it is something that we are considering for future. 

    • Condition precedent: refers to a requirement that has to be satisfied or fulfilled before the beneficiary will be entitled to receive the gift (for example, someone has to graduate university before receiving their gift)
    • Condition subsequent: refers to a fact or circumstance that if arising after the receipt of the gift by the beneficiary could cause the forfeiture of the gift (for example, taking the gift back because the beneficiary didn’t go to medical school) *this is always unenforceable because you cannot give something to someone and then purport to take it back at some point if something changes

    Marriage: regardless of whether the condition is precedent or subsequent, you can’t leave a gift that’s conditional on the person’s marriage. Partial restriction on marriage, including restrictions on remarrying, marrying a specific person, or marrying without consent, are all considered valid provided that they are considered reasonable in the circumstances.

    Willful vs. using a lawyer

    See how much you can save by choosing Willful

    What province do you live in?

    Willful vs. using a lawyer

    Do you want to create a will or a will and power of attorney documents?
    Do you want to create a will or a notarial will?
    Will only

    Will and Powers of Attorney

    Notarial will


    Willful vs. using a lawyer

    Besides yourself, how many additional family members need to create their will?

    Willful vs. using a lawyer

    Common Law Saskatchewan: What It Means And What You’re Entitled To
    Wills and Estate Planning for Indigenous Peoples of Canada
    Is Your Common Law Partner Entitled to Inheritance?

    Get peace of mind for you and your family by
    creating your will today.