A trust arrangement you have never thought about could create a tax filing obligation.
The Canada Revenue Agency (CRA) has announced important updates to trust reporting requirements that could affect Canadian businesses, property owners, and individuals involved in certain trust arrangements.
On October 5, 2026, the CRA confirmed that changes to trust reporting rules will apply to taxation years ending on or after December 31, 2026.
📌 What is a Bare Trust?
A bare trust generally exists when one person or entity holds legal ownership of property while another person or entity has the beneficial ownership and control of that property.
For example, bare trust arrangements may arise in situations involving:
- Real estate held in another person’s name
- Property held by a nominee corporation
- Certain family property arrangements
- Assets held on behalf of another individual or business
- Some corporate ownership and investment structures
An arrangement does not necessarily need to be called a “trust” to have trust-related tax implications.
🔍 What Has Changed?
Under the updated reporting framework, certain bare trusts may be required to file a T3 Trust Income Tax and Information Return.
Depending on the arrangement and applicable exemptions, reporting may also include Schedule 15 — Beneficial Ownership Information of a Trust.
The CRA has updated its guidance to help taxpayers understand which arrangements may be subject to these requirements.
Importantly, not every bare trust will be required to file. The rules contain exclusions and exemptions that must be considered.
💼 Why Should Business Owners Pay Attention?
Many business owners focus on corporate tax returns, GST/HST filings, payroll, and bookkeeping.
However, the legal ownership of business assets and real estate can also create reporting considerations.
Consider a corporation that holds legal title to property for another person or entity. Depending on the actual legal arrangement, the parties involved, and the applicable exemptions, additional trust reporting obligations may arise.
This makes it important to review ownership arrangements rather than assume that no filing is necessary simply because the arrangement generates no income.
✅ What Should You Review Before Year-End?
As 2026 approaches its final quarter, business owners and property holders should consider:
- Property ownership: Are any assets registered in someone else’s name?
- Corporate structures: Does a corporation hold assets as a nominee or trustee?
- Family arrangements: Are there arrangements involving legal and beneficial ownership by different parties?
- Documentation: Are trust agreements and ownership records properly maintained?
- Tax compliance: Has the potential requirement to file a T3 return and Schedule 15 been reviewed?
💡 The Bottom Line
Tax compliance is not limited to reporting income. It also involves understanding how assets are owned and held.
With updated bare trust reporting rules affecting the 2026 taxation year, reviewing your arrangements early can help identify potential filing requirements and avoid unnecessary compliance issues.
At SAR Professional Corporation, we help Canadian businesses and individuals navigate tax compliance, corporate accounting, and financial reporting requirements.
📩 Unsure whether your property or corporate ownership structure creates additional tax reporting obligations?
Contact SAR Professional Corporation to discuss your circumstances and prepare for the 2026 reporting year.
