Enhanced reporting rules for trusts and bare trusts: Frequently asked questions

The CRA does not provide legal advice so it is not able to advise taxpayers about the application of the private law to their specific circumstances or to interpret trust documents. It is the responsibility of the parties involved in an arrangement to determine the true nature of their legal relationships and whether they give rise to a trust.

Determining whether a particular arrangement is a trust is a question of fact and law based on an analysis of the facts specific to each situation under the applicable private law. Taxpayers may wish to consult a legal advisor for help in understanding all of the legal consequences of their trust or ownership arrangements.

See Question 1.1 for a very general overview of the legal (non-tax) principles that apply to trusts in Canada. 

There are three main additions to the trust reporting rules for taxation years ending on or after December 31, 2023:

• All trusts, unless certain conditions are met, are required to file a T3 return annually. See Question 2.1 for more information about the trusts that are required to file.
• Generally, all trusts that are required to file a T3 return, other than listed trusts , must include specified information about each reportable entity of the trust, as outlined on Schedule 15, with their T3 return. See Question 2.3 for the listed trusts applicable for taxation years ending on or after December 31, 2023.
• Bare trusts are subject to the trust reporting rules. However, for the 2023 and 2024 taxation years, the CRA will not require bare trusts to file a T3 return, including Schedule 15, unless the CRA makes a direct request for these filings

Generally, all trusts that are required to file a T3 return, other than listed trusts, must include specified information  about each reportable entity  of the trust, as outlined on Schedule 15, with their T3 return.

Schedule 15 requests specified information on all trustees, settlors, beneficiaries, and controlling persons (i.e., persons who have the ability, through the terms of the trust or a related agreement, to exert influence over trustee decisions regarding the appointment of income or capital of the trust) of the trust (collectively referred to as “reportable entities”).

The following specified information is required for each reportable entity of the trust:

• Name
• Address
• Date of birth (if an individual)
• Country of residence
• Tax identification number (i.e., social insurance number, business number, trust number, or, in the case of a non-resident trust, the identification number used in a foreign jurisdiction)

Part B of Schedule 15 is to be completed separately for each reportable entity and for each entity type they hold. There should only be one tax identification number for each copy of Part B that is completed.

The following table shows the format required for the different types of tax identification numbers:

When required, Schedule 15 must be filed each taxation year with the T3 return even if there are no changes in respect of the reportable entities. However, if you have provided the specified information about a reportable entity in a previous taxation year and there have been no changes, that information can be carried forward and does not need to be added to Schedule 15 again. If there has been no change in the specified information about each of the reportable entities, select “No” for the second question in Part A of Schedule 15 to allow all previously filed information to be carried forward.

Part B of Schedule 15 should include information for the following situations:

• The addition or removal of reportable entities that occurred during the taxation year
• The addition and removal of reportable entities that both became and ceased to be a reportable entity during the taxation year (for example: a temporary trustee was appointed and replaced during the same taxation year)
• The addition of reportable entities that became reportable entities in a previous taxation year and continue to be reportable entities in the current taxation year, where this has not yet been reported on a previous Schedule 15 filing
• The removal of reportable entities that ceased to be reportable entities in a previous taxation year, where this has not yet been reported on a previous Schedule 15 filing
• Specified information about reportable entities that has changed since the last time it was reported

The person making the T3 return must provide the specified information  about each beneficiary of the trust whose identity is known or ascertainable with reasonable effort by the person making the return at the time of filing the return. Complete Part B of Schedule 15 for each beneficiary of the trust whose identity is known or ascertainable with reasonable effort. For their own records, the trustee should document the efforts taken to collect the information.

If the identity of a beneficiary is not known or ascertainable with reasonable effort (for example, unborn children and grandchildren, their spouses), then the person making the return is required to provide sufficiently detailed information to determine with certainty whether any particular person is a beneficiary of the trust. In this case, provide the information requested in Part C of Schedule 15. For their own records, the trustee should document the efforts taken to collect the information.

Where the beneficiaries of a trust are all of the members of an Indigenous group, community, or people that holds rights recognized and affirmed by section 35 of the Constitution Act, 1982, or an identifiable class of the members of such Indigenous group, community or people, the person making the T3 return should provide a sufficiently detailed description of the class of beneficiaries to determine with certainty whether any particular person is a member of that class of beneficiaries.

Where some but not all of the units of a trust are listed on a designated stock exchange, the requirement to provide information for the beneficiaries of the trust is met if the specified information is provided for the beneficiaries of those classes of units that are not listed on a designated stock exchange.

Subsection 204.2(1) of the Income Tax Regulations requires the person making the T3 return, including Schedule 15, to report specified information  about all reportable entities  of the trust in the taxation year. The Income Tax Regulations do not include a relieving provision where the person making the return does not know the identity of a particular reportable entity, other than where the reportable entity is a beneficiary, as discussed in Question 1.6.

A trust that is resident in Canada, including a trust deemed resident in Canada under subsection 94(3), other than a listed trust , must file a T3 return annually, if the trust is an express trust (or the trust is, for civil law purposes, a trust other than a trust that is established by law or by judgement). This does not include bare trusts for the 2023 or 2024 taxation years, unless the CRA makes a direct request for these filings.

For all other trusts (resident and non-resident), including listed trusts, a T3 return is required to be filed for taxation years in which the trust has at least one of the following situations:

• has tax payable
• is requested to file
• is a deemed resident trust 
• is resident in Canada and has either disposed of, or is deemed to have disposed of, a capital property or has a taxable capital gain (for example, a principal residence, or shares in the capital stock of a corporation)
• is a non-resident throughout the year, and has a taxable capital gain (other than from an excluded disposition described in subsection 150(5)) or has disposed of taxable Canadian property (other than from an excluded disposition)
• holds property that is subject to subsection 75(2)
• has provided a benefit of more than $100 to a beneficiary for upkeep, maintenance, or taxes for property maintained for the beneficiary’s use (for more information, see “Line 24 – Upkeep, maintenance, and taxes of a property used or occupied by a beneficiary” in the T4013 T3 Trust Guide), or
• receives from the trust property any income, gain, or profit that is allocated to one or more beneficiaries, and the trust has:
  • total income from all sources of more than $500
  • income of more than $100 allocated to any single beneficiary
  • made a distribution of capital to one or more beneficiaries, or
  • allocated any portion of the income to a non-resident beneficiary

Generally, all trusts that are required to file a T3 return, other than listed trusts, must include specified information about each reportable entity of the trust, as outlined on Schedule 15, with their T3 return.

Listed trusts are only required to file a T3 return for a taxation year in which one of the situations outlined in Question 2.1 applies to the trust for the taxation year. Listed trusts are not required to include Schedule 15 when filing a T3 return.

 “Listed trusts” are provided in paragraphs 150(1.2)(a) to (o), and include a trust that:

1. had been in existence for less than three months at the end of the year;
   • see Question 2.5 for more information
2. holds assets with a total fair market value that does not exceed $50,000 throughout the year, if the only assets held by the trust throughout the year are one or more of the following:
   1. money (note that money does not include collectible gold or silver coins, or gold or silver bars),
   2. a debt obligation described in paragraph (a) of the definition “fully exempt interest” in subsection 212(3),
   3. a share, debt obligation, or right listed on a designated stock exchange,
   4. a share of the capital stock of a mutual fund corporation,
   5. a unit of a mutual fund trust,
   6. an interest in a related segregated fund (within the meaning assigned by paragraph 138.1(1)(a), and
   7. an interest, as a beneficiary under a trust, all of the units of which are listed on a designated stock exchange;
3. is required under the relevant rules of professional conduct or the laws of Canada or a province to hold funds for the purposes of the activity that is regulated under those rules or laws, provided the trust is not maintained as a separate trust for a particular client or clients (this provides an exception for a lawyer’s general trust account, but not for specific client trust accounts);
4. is a registered charity;
5. is a club, society or association described in paragraph 149(1)(l);
6. is a mutual fund trust;
7. is a related segregated fund trust (within the meaning assigned by paragraph 138.1(1)(a));
8. is a trust, all of the units of which are listed on a designated stock exchange;
9. is a trust prescribed to be a master trust;
10. is a graduated rate estate;
11. is a qualified disability trust;
12. is an employee life and health trust;
13. is a trust described under paragraph 81(1)(g.3);
14. is a trust under or governed by a
    1. deferred profit sharing plan,
       • see Deferred Profit Sharing Plans for more information
    2. pooled registered pension plan,
       • see Pooled Registered Pension Plans for more information
    3. registered disability savings plan,
       • see What is a Registered Disability Savings Plan for more information
    4. registered education savings plan,
       • see Registered Education Savings Plan for more information
    5. registered pension plan,
       • see Registered Pension Plan for more information
    6. registered retirement income fund,
       • see Registered Retirement Income Fund for more information
    7. registered retirement savings plan,
       • see Registered Retirement Savings Plan for more information
    8. tax-free savings account,
       • see The Tax-Free Savings Account for more information
    9. employee profit sharing plan,
       • see Employees Profit Sharing Plan for more information
    10. registered supplementary unemployment benefit plan, or
        • see Supplementary Unemployment Benefit Plan for more information
    11. first home savings account; or
        • see First Home Savings Account for more information
15. is a cemetery care trust or a trust governed by an eligible funeral arrangement

Generally, an express trust is a trust created with the settlor's express intent, usually set out in writing (as opposed to a resulting or constructive trust, or certain trusts deemed to arise under the provision of a statute). Many types of trusts are express trusts.

A trust that was in existence for less than three months at the end of the taxation year is a listed trust (see Question 2.3, paragraph 150(1.2)(a) for more information). As a listed trust, it would not be required to file a T3 return unless one of the situations outlined in Question 2.1 applies to the trust for the taxation year. Further, a listed trust is not required to file Schedule 15.

The following trusts are considered to have been in existence for less than three months at the end of the taxation year:

• Trusts that ceased to exist during the particular taxation year, at a date which is less than three months after the trust was created
• Trusts that were created less than three months before the end of the particular taxation year.

Internal trusts are those created when a charity receives property as a gift that is subject to certain legally enforceable terms and conditions and holds that property as trustee of the trust.

The CRA will not require registered charities to file a T3 return for internal trusts. See Filing requirements for charities administering internal trusts for more information.

Several examples are provided below to assist taxpayers in determining their trust reporting obligations. Please note:

• The determination of whether a particular arrangement is a trust is a question of fact and law based on an analysis of the facts specific to each situation under the private law of the relevant jurisdiction. It is the responsibility of the parties involved in an arrangement to determine the true nature of their legal relationships and whether they give rise to a trust.
• These examples do not include bare trust filing requirements. As indicated in Question 3.2, the CRA will not require bare trusts to file a T3 return, including Schedule 15, for the 2023 or 2024 taxation years, unless the CRA makes a direct request for these filings. More information regarding the reporting requirements for bare trusts for their 2025 and subsequent taxation years will be provided as it becomes available.
• Although the trust reporting rules are the same for the 2023 and 2024 taxation years, the examples include both taxation years to demonstrate the effect that changing circumstances could have on the reporting requirements for a particular trust.

Question 1.1 provides a general overview of the legal (non-tax) principles that apply to trusts and bare trusts in Canada.

The term “bare trust” is not defined in the Income Tax Act. However, subsection 104(1) provides that a bare trust for income tax purposes is a trust arrangement under which the trustee can reasonably be considered to act as agent for all the beneficiaries under the trust with respect to all dealings with all of the trust's property.

A trustee can reasonably be considered to act as agent for a beneficiary when the trustee has no significant powers or responsibilities, the trustee can take no action without instructions from that beneficiary and the trustee’s only function is to hold legal title to the property. In order for the trustee to be considered to be the agent for all the beneficiaries of a trust, it would generally be necessary for the trust to consult and take instructions from each and every beneficiary with respect to all dealings with all of the trust property.

A common example of a bare trust arrangement is when, for privacy reasons, a property developer establishes a bare trust to hold registered title to real property, while the developer retains beneficial ownership.

2023 taxation year: As announced in the Tax Tip issued March 28, 2024, in recognition that the enhanced reporting rules for bare trusts have had an unintended impact on Canadians, the CRA will not require bare trusts to file a T3 return, including Schedule 15, for the 2023 taxation year, unless the CRA makes a direct request for these filings.

2024 taxation year: As announced in the Tax Tip issued October 29, 2024, the CRA will not require bare trusts to file a T3 return, including Schedule 15 for the 2024 taxation year, unless the CRA makes a direct request for these filings. This is a continuation of the exemption from the trust reporting rules that was issued for bare trusts for the 2023 taxation year.

Due to the nature of bare trusts, not all information requested on the T3 return may be relevant. The following guidance is provided to assist you in completing each relevant section of the T3 return:

• T3 return: Step 1 – Identification and other information
  • When using our online services, identify the type of trust as “bare trust” by selecting “code 307, Bare Trust” and provide the trust creation date in the appropriate field.
  • If this is the first year of filing a trust return, send us a copy of the trust document, unless this information or document has been previously submitted. 
  • Where applicable, provide information about whether the trust is filing its final return (and if so, provide the date on which the trust ceased to exist).
  • Provide a response and information related to applicable questions on page 2.
• T3 return: Step 5 – Summary of tax and credits
  • Complete the last page including the parts “Name and address of person or company who prepared this return” and “Certification”.
• Schedule 15 – Beneficial Ownership Information of a Trust
  • Complete all parts of Schedule 15. Please refer to Question 1.4 for the information to be entered on Schedule 15.

For bare trusts, the remaining parts of the T3 return can be left blank. All income, capital gains and capital losses from the trust property should be reported on the beneficial owner’s tax return.

Here are some guidelines for naming a bare trust that has not been named:

• If there is a written trust deed or other agreement governing the bare trust, and the document identifies a name for the bare trust, enter this in the name field.
• If there is no written trust deed or other agreement governing the bare trust, or if the document does not identify a name for the bare trust, list the legal name of the beneficial owner(s). For example:
  • If the beneficial owner is a corporation, list the full corporate name identified in the articles of incorporation with the word “Trust” at the end.
  • If the beneficial owner is an individual, list the first and last names of the individual with the word “Trust” at the end (for example: Jane Smith Trust). If there is more than one beneficial owner, place the names in alphabetical order based on the beneficial owners’ last names with the word “Trust” at the end of the list (for example: Davis Johnson Miller Trust). 

As the name field in our online services is limited to 60 characters, include only the first 54 characters of the name and then the word “Trust".

While the Income Tax Act requires bare trusts to file T3 returns for the 2023 and 2024 taxation years, the CRA has waived this filing requirement for all bare trusts, unless the CRA makes a direct request for these filings. Given that the Act includes the requirement for bare trusts to file, the CRA will accept and process any T3 return, including Schedule 15, that it receives.

In most cases, a final T3 return must be filed for the taxation year in which a trust ceases to exist. On page 2 of the return, indicate that the return is the final return of the trust and enter the date on which the trust ceased to exist. No further steps are required.

For bare trusts, the CRA will not require bare trusts to file a T3 return for the 2023 and 2024 taxation years, unless the CRA makes a direct request for these filings. Where a bare trust has a trust account number and ceased to exist in the 2023 or 2024 taxation year, the following steps may be taken to close the trust account number:

• the trustee of a bare trust may voluntarily choose to file a final T3 return with the date on which the bare trust ceased to exist,
• the trustee of a bare trust may call the general enquiries line at 1-800-959-8281, or
• the trustee of a bare trust may send a letter to either the Sudbury Tax Centre or the Winnipeg Tax Centre that includes the trust account number, bare trust name, the fact that the bare trust has ceased to exist, and the date on which the bare trust ceased to exist.

As the primary trustee, you are the legal representative of the trust and are able to make changes to the account. You can call the CRA or submit documents by mail as soon as your trust account number is issued. If you want online access to the account, you will first need to register as the Primary Trustee using the Authorization Request option in Represent a Client. Once you have registered, you will have online access as a trustee and will have full access to My Trust Account, which is accessed via Represent a Client.

Once you have registered as the Primary Trustee, you can add authorized representatives to the trust in the Authorized Representatives section of the trust’s Profile in My Trust Account.

Mandatory disclosure rules are different and are based on separate provisions of the Income Tax Act. Trustees are one of several entities that are subject to these rules. For more information, visit Mandatory disclosure rules – Overview.

Yes. The UHT-2900 Underused Housing Tax Return is separate from the enhanced trust reporting rules. The obligation to file a T3 return and Schedule 15 is not satisfied by a UHT-2900 filing. For information on the Underused Housing Tax, including who must file, please visit Introduction to the Underused Housing Tax.