Alberta vs BC: Probate + Deemed Disposition on a $1.5M Estate (2026)

The Scenario: $1.5M Estate, Two Provinces, Same Assets

Take the same person — widowed, two adult children, no spouse for a section 70(6) rollover — and place them in Calgary (Alberta) or Victoria (British Columbia). Same estate, same assets, same family. The only variable is the province of residence at death. Here is what they leave behind:

Three things happen at death. First, provincial probate is assessed on the estate value passing through the will. Second, the RRSP collapses into ordinary income on the terminal T1 return under section 146(8.8). Third, section 70(5) triggers a deemed disposition on the non-registered portfolio — CRA treats you as having sold it at fair market value the instant before death, crystallizing the accrued gain. The principal residence is sheltered by the section 40(2)(b) exemption. Now let us run the numbers province by province.

Probate Fees: $525 in Alberta vs ~$20,650 in BC

This is the first place the two provinces diverge sharply, and Alberta wins by a wide margin. Alberta charges flat surrogate court fees with a hard cap: the maximum is $525 regardless of whether the estate is worth $200,000 or $20,000,000. A $1.5M estate pays $525. Full stop.

British Columbia takes the opposite approach — a tiered fee with no upper limit:

• First $25,000: $0
• $25,000 to $50,000: $6 per $1,000 = $150
• Above $50,000: $14 per $1,000. On $1,450,000 that is $20,300
• Plus a $200 court filing fee
• BC total: roughly $20,650

The gap on this $1.5M estate is about $20,125. And because BC's fee has no cap while Alberta's does, the gap only widens as estates grow. This is the mirror image of the Quebec notarial-will advantage — except here it is Alberta's flat cap doing the work, and BC sitting near the top of the expensive-probate provinces alongside Ontario and Nova Scotia.

The Full Provincial Comparison Table

To rank Alberta and BC against the rest of the country — sorted by total cost on this $1.5M estate, combining probate and the higher top marginal rate that hits the deemed disposition:

Alberta is the only province in the country that pairs near-zero probate with the lowest top marginal rate. Quebec's notarial will gives $0 probate but its 53.31% rate punishes the deemed disposition. Saskatchewan has the lowest rate of all (47.50%) but charges $7 per $1,000 of probate from the first dollar. For the full breakdown across every province, see our cross-Canada probate comparison.

The Deemed Disposition: $300K Gain Where the Rate Actually Matters

The non-registered ETF portfolio has a fair market value of $500,000 and an adjusted cost base of $200,000 — a $300,000 capital gain deemed realized under section 70(5) the moment before death. The 2026 capital gains inclusion rate is 50% (the proposed increase to 66.67% was cancelled March 21, 2025), so $150,000 of taxable capital gain is added to the terminal return.

Here is where the province stops being a footnote. That $150,000 of taxable gain stacks on top of the RRSP collapse, so it sits squarely in the top bracket. At Alberta's 48.00% top combined rate, the tax on the $150K taxable gain is approximately $72,000. At BC's 53.50% top combined rate, it is approximately $80,250. That is an $8,250 difference on the deemed disposition alone — and it exists purely because of the 5.5-percentage-point spread in the top rate.

RRSP Collapse: $400K Taxed at the Top — and BC Charges More

The RRSP is the largest single tax event on this estate. Under section 146(8.8) of the Income Tax Act, the entire $400,000 RRSP balance is included as ordinary income on the deceased's terminal T1 return. No spouse means no rollover. No financially dependent minor child means no deferral. The $400K hits the terminal return in a single year.

The terminal-return income stacks up like this:

• RRSP collapse: $400,000
• Taxable capital gain on the deemed disposition ($300K gain at 50%): $150,000
• CPP/OAS partial-year income: ~$20,000
• Total taxable income: ~$570,000

At roughly $570,000 of taxable income, the vast majority of this terminal return sits above the ~$253,000 threshold where the top combined rate applies. That is where the 48.00% vs 53.50% spread does its damage. On the roughly $317,000 of income sitting in the top bracket, BC charges about 5.5 cents more per dollar than Alberta — roughly $17,400 of extra BC tax on the top-bracket portion alone, before counting the lower brackets or the probate gap. For a deeper look at why RRSP-heavy estates with no spouse are so expensive, see our guide to RRSP taxation at death.

Total Settlement Cost: Alberta vs BC Side by Side

The income tax figures here blend the lower brackets with the top bracket, so they are estimates rather than precise terminal-return calculations — the exact number depends on the deceased's other income and credits. But the direction is unambiguous: Alberta's combined advantage on this $1.5M estate is roughly $45,000, split between about $20,125 in probate savings and roughly $25,000 in income-tax savings driven by the lower top rate. This is the rare provincial comparison where both levers point the same direction.

Why This Comparison Is Different From Ontario vs Quebec

In the Ontario-versus-Quebec matchup, the only real gap is probate — their top marginal rates are within a fifth of a percentage point of each other (53.53% vs 53.31%), so the income tax on the deemed disposition and RRSP collapse comes out nearly identical. Province choice there moves the probate bill and almost nothing else.

Alberta versus BC is a different animal. Here the provinces differ on both axes. Alberta has the lowest top combined rate in the country (48.00%) and a hard probate cap ($525). BC has one of the highest top rates (53.50%) and an uncapped tiered probate fee. So on a $1.5M estate built around an RRSP collapse and a large deemed gain, the choice of province compounds: the lower rate saves on the income tax, the cap saves on probate, and the two savings stack. That is why Alberta's total advantage here is more than double the probate gap alone.

4 Strategies to Reduce This Bill in Either Province

1. Draw down the RRSP before death

The $400K RRSP drives the single biggest tax line item. Drawing $40,000 to $60,000 per year starting at age 65, when other income is lower, pays tax at combined marginal rates in the 30–37% range instead of the 48–53.5% range a full terminal-return collapse produces. Over a decade of measured withdrawals, the tax saving on a $400K RRSP can run $30,000 to $50,000. The trade-off is reduced tax-deferred compounding — but for an estate with no spouse rollover, the math nearly always favours earlier, bracket-managed withdrawals. The benefit is larger in BC, where the avoided top-bracket rate is higher.

2. Name RRSP and TFSA beneficiaries directly

Naming your children as direct RRSP beneficiaries removes the $400,000 from the probate calculation. In Alberta the saving is trivial because probate is capped at $525 anyway. In BC it matters: pulling $400K out of the probated estate saves roughly $5,600 in the $14-per-$1,000 tier. The income tax on the RRSP does not change — CRA still attributes the full balance to the terminal return regardless of who is named — but the BC probate saving is real. TFSAs work similarly: naming a successor holder (spouse) or beneficiary keeps the balance out of the estate and it is not taxable at death.

3. Use life insurance for terminal-return liquidity

A terminal return loaded with a $400K RRSP collapse and a $150K taxable gain generates a tax bill north of $250,000. A permanent life insurance policy with a named beneficiary provides tax-free cash to pay that bill without forcing a fire sale of the non-registered portfolio or the home. The proceeds bypass probate in both provinces when a named individual (not the estate) is the beneficiary. For an estate this size, a $250,000 to $300,000 policy is a defensible liquidity tool — model the premiums against your age and health before committing.

4. Crystallize gains gradually instead of all at once

The $300K deemed gain hits in a single year at death, forcing the entire $150K taxable portion into the top bracket. Realizing portions of the non-registered gain across several lower-income years — for example after the RRSP is drawn down but before death — spreads the gain across lower brackets. This is most effective when paired with strategy #1: in a year where you draw less RRSP income, you have room to realize a slice of the capital gain at a 30–40% rate instead of the 48–53.5% top rate the estate would otherwise pay. The downside is you pay the tax earlier and lose some deferral; the upside is rate arbitrage, and it is worth more in BC.

The Verdict: Alberta Wins on Both Levers

For this $1.5M estate, Alberta is the clear winner — and not by a narrow margin. On probate, Alberta's $525 cap beats BC's roughly $20,650 by about $20,125, a gap that only grows on larger estates because BC's fee has no ceiling. On income tax, Alberta's 48.00% top combined rate beats BC's 53.50% by 5.5 percentage points on every top-bracket dollar of the RRSP collapse and the deemed disposition — roughly $25,000 more in BC on this estate. Combined, Alberta saves the estate in the neighbourhood of $45,000.

But the province is the smaller story. The dominant cost in both provinces is the income tax on the $400K RRSP and the $300K deemed gain — together more than $250,000 in Alberta and over $280,000 in BC. The levers that actually move that number — drawing the RRSP down early, naming beneficiaries, crystallizing the gain across lower-income years, holding life insurance for liquidity — are decisions made years before death, and they work in both provinces. Province of residence sets the rate. Pre-death planning sets how much income gets exposed to it. For the foundational mechanics of how Canada taxes estates, see our inheritance tax overview.