In 2023, CRA introduced sweeping new T3 trust reporting requirements that captured a wide range of arrangements most Canadians had never considered to be trusts — including bare trusts. The rules caused significant confusion and were ultimately subject to administrative relief for the 2023 tax year. However, bare trust reporting requirements are now in force for 2024 and beyond, and Calgary real estate investors, property owners, and joint account holders must understand their obligations. This is particularly relevant for Alberta investors who hold property jointly or through nominee arrangements — a common strategy that now carries formal reporting requirements. For a broader overview of your obligations as a rental property owner, see our guide to rental income tax in Calgary.
A bare trust exists when one person holds legal title to property on behalf of another person who is the true beneficial owner — and the legal holder has no discretion over the property; they must deal with it entirely as directed by the beneficial owner. Common examples include:
The key characteristic is that the legal holder has no beneficial interest — they are simply holding on behalf of someone else.
Under rules effective for trust years ending after December 30, 2023, all express trusts resident in Canada — including bare trusts — must file a T3 return annually. The T3 return for a bare trust must disclose:
This information disclosure requirement is the primary driver of the changes. CRA's goal is to identify the true beneficial ownership of property — particularly real estate — through the trust reporting framework.
Not all bare trusts must file. Exemptions include:
| Arrangement | Likely Bare Trust? | T3 Required? |
|---|---|---|
| Parent on child's bank account | Yes | Possibly — depends on exemption |
| Parent on title for mortgage | Yes | Yes — real estate over $50K |
| Joint investment account (one beneficial owner) | Yes | Depends on value/type |
| TFSA or RRSP | No — registered plan | No |
| Agent holding client funds momentarily | Possibly — depends on facts | CRA guidance ongoing |
The 2024-and-beyond filing requirement described above did not arrive cleanly. Prior to the 2022 federal budget (legislated through Bill C-32), trusts with no income, no capital gains, and no distributions in a year were generally exempt from filing a T3 return at all — which meant CRA had almost no visibility into bare trusts and informal nominee arrangements. The new rules, effective for trust taxation years ending after December 30, 2023, eliminated that "nil return" exemption for most trusts and introduced the Schedule 15 beneficial-ownership disclosure now required.
As the original April 2, 2024 T3 filing deadline approached for the 2023 tax year, it became clear that the practical burden on ordinary Canadians was far greater than anticipated — the requirement swept in routine arrangements like joint accounts between spouses and parents added to a child's mortgage, situations that had never before triggered a trust filing. On March 28, 2024, CRA announced last-minute administrative relief: it would not impose penalties on bare trusts that skipped the 2023 T3 filing, unless CRA had directly contacted that specific trust and requested a return. Trusts that had already filed for 2023 could not un-file, but no new bare trust filings were required for that year.
That relief was a one-time administrative concession for the 2023 tax year only — it was not a policy reversal. When the requirement returned for 2024, the government had refined the exemptions in response to the backlash. For the 2024 tax year, a bare trust is exempt from filing only if all of the following are true: the only trustee and the only beneficiary are the same individual; the arrangement was created solely to satisfy a legal requirement (such as a joint account needed to complete a transaction) and is not part of any tax or income-splitting plan; and the fair market value of the trust property does not exceed $50,000, with the only assets being cash, GICs, or listed securities. Where any one of those conditions fails — which is the case for most real estate arrangements — the T3 and Schedule 15 filing obligation applies for 2024 and subsequent years.
If you think you may have a bare trust arrangement — particularly involving real estate, bank accounts, or investment accounts where the legal and beneficial owners differ — you should:
Many joint ownership arrangements were established for estate planning purposes — to allow assets to pass outside the estate and avoid probate. The new bare trust reporting requirements add compliance costs to these strategies. In some cases, reviewing whether the estate planning benefit still outweighs the reporting burden — or whether alternative strategies (a designated beneficiary, a will, or a different ownership structure) are more efficient — is worthwhile. Calgary real estate investors who are considering restructuring their property holdings may also want to review whether incorporating in Alberta offers a cleaner structure for both estate planning and ongoing tax efficiency.
Many Calgary property owners discovered in 2023 that they unknowingly had reporting obligations for arrangements they had never considered to be trusts — and a 5% gross-value penalty for gross negligence is not a risk worth taking on real estate holdings. Determining whether your arrangement constitutes a bare trust, whether an exemption applies, and how to properly complete the T3 and Schedule 15 are tasks best handled with professional guidance. Our corporate tax team and trust specialists assist Calgary real estate investors and families with trust identification, ownership structure review, and T3 compliance. If you're unsure whether your property arrangement triggers a filing obligation, book a consultation — the March 31 deadline moves fast.
