Bare trust reporting: do you need to file?

Revised bare trust rules mean some Members may now need to file a trust return (called a T3 return) for arrangements they may not think of as a trust. This short check will help you find out if you must file, and lets you send us the information we need to file for you.

Bare trusts usually come about through lending or financing for others, land registration, or probate, rather than for tax reasons. Often there’s no written trust document at all. The arrangement is shown only by the facts around it.

February 15, 2027Send us your completed check by this date so we can file for you

March 31, 2027CRA filing deadline for the 2026 tax year

$25 a dayLate-filing penalty, up to $2,500

What is a bare trust?

A bare trust exists when one person’s name is on the title of a property or account, but it really belongs to someone else. It often comes up with estate planning, family bank accounts, and farmland that has been moved into a corporation.

These arrangements have always been considered trusts. In the past they didn’t have to file a tax return. Now, many do.

Why this matters to you

The CRA puts the responsibility on each person to identify their own bare trust. We can’t see these arrangements on your regular tax return, so we need you to tell us.

If a T3 return is needed and isn’t filed on time, the CRA can charge a penalty of $25 for each day it’s late, up to $2,500.

Which property needs a return?

Not every bare trust needs a T3 return. It depends on what the property is.

Type of property	T3 return
Farmland	Required
Bank accounts or investments worth more than $50,000 at any time in the year	Required
Principal residence (the home someone lives in)	Exempt
Bank accounts or investments worth $50,000 or less all year	Exempt
Family investments, when all of these are true: Each trustee and beneficiary is an individual Each beneficiary is related to each trustee The property is investments It’s worth $250,000 or less throughout the year	Exempt
Real property held between spouses or common-law partners	Exempt
A bare trust that has existed for less than 3 months	Exempt
Other property, like a cottage, rental or vacant land	We’ll check

Examples of bare trusts that need a return

An adult child is the only name on the title of a parent’s rental property or cottage, but it really belongs to the parent.
A corporation holds real estate, including farmland, for the people who really own it, whether that’s one owner or unrelated owners.
Farmland is registered in a person’s name but really belongs to the family farm corporation or partnership. Renting the land out doesn’t change this.
A vehicle, licence or other asset worth more than $50,000 is registered in a person’s name but owned by a corporation.
A joint account worth more than $50,000 is shared with adult children, but the money really belongs to the parents.

Words to know

Legal title: Whose name is listed as the owner, such as on a land title or at the bank.
Trustee: A person or organization that holds and manages property, money or assets on behalf of another person or group, and has a legal duty to act in their best interests.
Beneficiary: The person or company the property really belongs to.
Settlor: The person who creates a trust by putting property or assets into the arrangement for the benefit of one or more beneficiaries.
T3 return: The tax return the CRA uses for trusts.

Not sure?

Talk to a member of our Technical Tax Team. You can also choose “I’m not sure” in the check, and we’ll follow up with you.

Questions? Email [email protected]

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