In straightforward cases, beneficiaries receive their share of an inheritance and dictate for themselves how they spend or save their newfound assets. However, this process looks a bit different when the beneficiary is a minor. In BC, anyone under the age of 19 is considered a minor; minors cannot legally manage inherited property on their own, even when a will is deemed valid and clearly names the minor as a beneficiary.
Will-makers intending to gift minors an inheritance should ideally have plans to address this gap in advance. Without the right planning, courts are allowed to step in. If you were left an inheritance before turning 19, you’re an adult trying to help a minor navigate an inheritance, or you’re trying to understand what should have happened with assets left to you as a child, it helps to know how the law treats minors as beneficiaries and what protections are in place to safeguard your share until you come of age.
What Happens When a Beneficiary Is a Minor
Minors are legally permitted to inherit in BC. The same basic rights apply to them as to adult beneficiaries, whether they are named directly in a will, entitled to inherit from the estate under a wills variation due to British Columbia’s Wills, Estates and Succession Act, or entitled to a share of an estate under BC’s intestate succession rules when someone passes away without a valid will.
The only difference is that minors cannot access their inheritance, even when the will is valid, uncontested, and clearly names them. This is true regardless of how mature the child is or how simple the distribution might be. The will-maker can either set up a trust for the minor beneficiary and name a trustee to manage the assets, or the assets can fall under a guardianship of property, which may be addressed in a simple will or, more often, determined by the court when no guardian was named.
Trust for Minor Beneficiaries
Setting up a trust is a more secure option. Will-makers can create a trust within their will or through a separate trust. They must name a trustee to manage the inheritance on the minor’s behalf, as the trustee is legally responsible for handling the assets according to the specific terms established by the will-maker.
Trusts give will-makers greater control over how and when the minor beneficiary uses their inheritance. Beyond specifying who manages the funds, trusts can also be written to explain other conditions, such as what types of expenses the funds can be used for, how the use of funds is restricted, and when the minor is able to access these assets.
One of the practical advantages of a trust is that it does not have to end the moment the beneficiary turns 19. While the default position is that the trustee pays out whatever remains of the beneficiary’s share once they reach the age of majority, a trust can legally extend that timeline. The terms can hold the inheritance until the beneficiary reaches a later age, or release it in stages, such as a percentage at 21, another portion at 25, and the balance at 30. The idea is to help minors reduce the risk of asset misuse, ensure funds are directed toward the child’s needs, and provide the will-maker some confidence that the inheritance will serve the child’s best interests.
Guardianship of Inherited Property
A guardian can be named directly in a will, which is often the simpler route when the inheritance is modest and does not warrant the cost and complexity of setting up a trust. When no guardian is named, BC law steps in and a guardian or the Public Guardian and Trustee (PGT) takes control of the assets on behalf of the minor.
Notably, a parent is not automatically granted the role of guardian of property. When a child inherits through a will or as a named beneficiary of a registered investment or insurance product, and no trustee has been named, the child’s parent or guardian must apply to the court to be appointed to manage that property. If no one has been named and no application is made, the court steps in to appoint a guardian of property. In more complex estates, more than one guardian may be appointed to share the responsibility.
When the court considers who should serve in this role, it looks at the proposed guardian’s emotional, financial, and moral suitability. The guardian’s authority is also limited: they cannot use inherited funds for their own benefit unless that use is specifically authorised in the will or trust, or approved by the court.
Assets managed under a guardianship arrangement are generally handed over directly to the minor at age 19 in BC, regardless of maturity or readiness. Without a trust in place, court approval is often required to access any of the funds before the beneficiary reaches the age of majority, which can make it harder to use the inheritance for the child’s ongoing needs in the meantime.
Get Help from Stephens & Holman
If you have reason to believe your share of an inheritance was mishandled, withheld, or never properly accounted for, an experienced estate litigation lawyer can help you understand your options. Stephens & Holman has guided clients across BC through these kinds of disputes and can review the details of your situation. Contact one of our offices today to schedule a free consultation.