Overview

Who is considered a minor

In Alberta, a minor is someone under the age of 18.

A minor’s trust may continue beyond the age of 18, depending on the wording of a:

  • will
  • court order
  • settlement document

How a minor may receive assets

A minor could receive assets, such as cash or property, from many different sources. Some examples are a:

  • personal injury settlement
  • life insurance policy
  • Victims of Crime compensation settlement
  • Worker's Compensation claim
  • testamentary document, such as a will
  • relative's estate, where the relative has died without a will
  • fatal accident settlement
  • pension plan
  • Registered Retirement Savings Plan (RRSP)
  • Tax Free Savings Account

What happens when a minor is awarded assets

The wording of a will, court order or settlement document might state who is to be the trustee for the funds or property. If it does not, then the funds or property must be held by the Public Trustee – with some exceptions.

A parent or guardian may apply to the court to be a minor’s trustee if:

  • a trustee has not been named
  • the Public Trustee is not required to be the trustee

Minor awarded under $25,000 with no named trustee

If a minor is owed under $25,000 and a trustee has not been named, the holder of the funds may choose to provide the funds to either the:

  • Public Trustee
  • parent or guardian

Parents and guardians may request to manage the funds for the minor if there’s no named trustee. A bond is usually required for them to do this.

The organization or person transferring the funds must have the parent or guardian sign a Guardian’s Acknowledgement of Responsibility Form. This acknowledges they’re responsible for managing the funds in the ‘best interest of the minor’ – and means they must put the child’s needs first.

How to become the trustee of a minor's property

If you want to be the trustee of the minor’s property, you should:

  • make sure you understand the duties and responsibilities
  • get a lawyer’s help with filing the court application
  • serve the Public Trustee with the notice of application for trusteeship of the minor’s property

If you don’t have a lawyer, contact the Law Society of Alberta’s Lawyer Referral Service.

If you’re appointed, you will:

  • manage the minor's assets
  • provide a financial report to the minor when they come of age

When the Public Trustee receives property including funds

The Public Trustee receives the money and:

  • invests it in the Public Trustee's Common Fund
  • guarantees the money 100% – the minor’s money is protected

The Public Trustee's Common Fund interest rate is set in accordance with the Public Trustee Act and is:

  • compounded daily
  • paid monthly to the minor's trust account

Parent or guardian involvement

The Public Trustee is responsible for managing the minor’s assets. Depending on the details of the document, the parent or guardian may assist by discussing with the Public Trustee how the funds should be used.

For example:

  • if the minor has been injured, the money may be necessary for therapy
  • if the minor's parents have died, the guardian may need help with day-to-day living expenses

Income taxes

Each trust earns interest income. All income is reported by the Public Trustee to the Canada Revenue Agency through annual T-3 Information slips.

The minor's parent or guardian:

  • receives copies of the T-3 slips every year
  • should get advice from a tax specialist
  • decides whether a tax return should be filed on behalf of the minor
  • should contact the Public Trustee and provide a copy of the minor’s tax return if one was filed

Income tax owed because of interest earned by the minor's trust may be paid from the minor's trust account.

How trust money is paid out

The trust money is payable once a person turns:

  • 18, or
  • the age specified in the trust document – which cannot be changed by the Public Trustee

Shortly before this, the Public Trustee gets in touch with the minor or their trustee to explain the process:

  • provide accounting to the former minor to review
  • ask the former minor to sign a Release form – if they agree with the accounting
  • deliver the remaining funds to the former minor or their trustee

If a person can't manage their money

It is assumed that everyone age 18 and over has capacity to make their own decisions.

If someone doesn’t have the capacity to make their own decisions when they reach 18, a capacity assessment should be completed.

Just because someone disagrees with an adult’s decisions doesn’t mean they’ve lost the ability to make their own decisions. If they fully understand the impact of a decision, they’re probably capable of making it.

An adult who does not have the capacity to make decisions needs someone to make decisions for them. A court order is needed for someone to help the adult by acting as:

  • an adult guardian for their personal decisions
  • an adult trustee for their financial decisions
  • both the guardian and trustee for all their decisions

Costs

Lawyers and accountants

The costs of agents the Public Trustee may hire, such as lawyers and accountants, are charged to the minor’s account.

Fees

The Public Trustee charges the following fees, which may change without notice, to manage the assets of a minor:

Initial fees

Table 1. Initial fees charged

Item Fee
File opening fee $75
Fee on each receipt of funds 1.5% (max. of $1,000)

Annual administration fee

Fees for the care and management of funds received are assessed for each complete year of management. They're based on the average of the cash balance at the beginning and end of the year from the anniversary of the first receipt date.

Table 2. Annual administration fees based on balance

Balance Fee
Below $5,000 $0
$5,000 and up to $10,000 $50
Over $10,000 and up to $50,000 $100
Over $50,000 and up to $100,000 $175
Over $100,000 $300

Table 3. Income tax fees

Type of Return Fee
Terminal T1 $25
T1 with instalments $50
Group T3 $25
T3 $40
Non-resident Group T3 20% of gross income (max. of $125)
GST 5% of the total income tax fee

Other fees

Table 4. Other fees

Item Fee
Purchase of investment $0
Fees for partial year Prorated
Fees on interest earned 5%
Postage, photocopies and faxes 2% of administration fees
Disbursement of funds $7.50 per payment
GST - on or after Jan 1. 2008 5% of total fees
GST - on or after July 1, 2006 6% of total fees
GST - up to July 1, 2006 7% of total fees
Final distribution and taxes paid $0

Additional resources

Canada Revenue Agency Taxes

Learn to Manage Your Money

Contact

Find an OPGT office near you

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