Family Patrimony

To do an inventory of one's patrimony can turn out to be very useful in order to easily trace the assets comprised in it. Why must we address this issue?

The rules governing family patrimony were introduced back in July 1989. Their intention is to protect the spouses who could find themselves financially disadvantaged at the end of the union. For example: a spouse who was married under the regime of separation of property and devoted himself or herself to the education of the children without any means to accumulate property.

The main rule is the following: there will be partition of the family patrimony in case the marriage (or civil union) is dissolved because of death, divorce or separation. Family patrimony does not apply to common-law spouses.

The assets included in the family patrimony are:

• All residences used by the family. Beware, only the flat used by the family inside an income building is included in this category;
• The furniture used by the family;
• The motor vehicles used for family transportation;
• The money and rights accrued during the marriage (or civil union) in a pension plan. This includes the Québec Pension Plan, the pension plan at work, RRSPs and other plans.

The assets excluded include bank accounts, investments, income buildings, companies or businesses and lastly, property received by a spouse as a gift or bequest before or during the marriage (or civil union).

It is the value of the property included in the family patrimony that is shared and not the property itself. From this amount, it will be necessary to subtract the value of the property from the patrimony owned by each spouse before their union.

For your information, there are strategies intended to limit the effects of the partition. They consist in the accumulation of property excluded from family patrimony.

This is why it is important to do the inventory of one’s patrimony. Interesting, is not it?

 

Stéphan Morin, CA
September 2005

Stéphan Morin is a Chartered Accountant and an investment adviser. He specializes in the management of financial assets and focuses on investment strategies to increase the return in a safe manner.