11 Mar Bare Trust Filing Deadline Reminder

Posted at 09:55h in business tax, Important Dates, Latest News, personal tax, Tax Planning and Compliance, Tax Season, Taxes by 11 Mar

Recent changes implemented by the Canadian government now require a Bare Trust to file a T3 Trust tax return (“T3 Return”) for the 2023 tax year, where previously there was no requirement to file.

A bare trust exists where a trustee holds legal title to property (e.g. real estate, bank account, investment portfolio, or any other asset) for the benefit of a beneficiary.  The trustee is a person or corporation who only holds the legal title to the property but has no other power, duties, obligations, or responsibilities related to that property – those all lie with the beneficiary, who is a different person or corporation.  

A bare trust relationship is commonly documented in various legal agreements called “Bare Trust Agreement,” “Nominee Agreement,” “Declaration of Bare Trust,” or “Agency Agreement,” but is does not need to be formally documented.

Some of the most common examples of bare trusts include:

  • A nominee corporation holds legal title to real estate where beneficial ownership is held by an individual, or an individual holds legal title to real estate and beneficial ownership is held by a corporation;
  • Parents/Grandparents holding bank accounts “in trust for” children/grandchildren;
  • Adult children have been added to the legal title of their aging parent’s property, or adult children have been added to the bank/investment accounts of their parents to save probate or
  • Parents were added to the legal title of their adult children’s property to obtain bank financing.

For more detailed information on these new filing requirements for trusts, please see our website at:

Failure to file a T3 Return for a Bare Trust could penalize the trustee.  The maximum penalties are higher than $2,500 or 5% of the assets held in trust.  

Please let us know if you are aware of any Bare Trusts you need our assistance with to prepare and file a T3 Return for the 2023 tax year.  These T3 Returns are due March 30th.