BARE TRUST REPORTING: It’s Here!

July 22, 2026

Sector:

New rules aimed at increasing transparency regarding the beneficial ownership of assets held through bare trust arrangements have been enacted and will apply to taxation years ending on and after December 31, 2026. These changes may catch many individuals and businesses that are unaware of their trust-like relationships, exposing them to potential penalties and other consequences for non-compliance.

A trust arrangement generally exists where the registered owner of an asset holds legal title on behalf of another person or entity that is the true beneficial owner. Where the trustee has no independent power or discretion over the property, the arrangement will typically be considered a bare trust arrangement.

Historically, bare trust arrangements were not subject to T3 filing requirements. However, starting 2026, if a bare trust exists at any time during the year, the bare trustee may be required to file a T3 return and Schedule 15. While certain exceptions may apply, many arrangements that were previously outside of the trust reporting requirements will now be required to file.

These arrangements are common, and most people don’t realize they’ve created a bare trust until someone points it out. If you recognize your situation in any of the examples below, give us a call. We’ll walk through the details with you and let you know exactly where you stand.

Business Administration Reasons

• A corporate bank account is opened by the shareholders, with the corporation being the beneficial owner of the funds;
• A corporation is on title of an individual’s real estate, vehicle or other asset, and vice-versa;
• Assets registered to one corporation but are beneficially owned by a related corporation;
• Use of a nominee corporation for real estate development purposes;
• A partner of a partnership holding a bank account or asset for the benefit of all the other partners of a partnership;
• A joint venture arrangement where the operator holds legal title to development property as an agent for the benefit of other participants;
• A cost-sharing arrangement where a person holds a business bank account, or other assets, to facilitate the arrangement while having no, or only partial, beneficial interest in these shared assets.

Industry-Specific Issues

• A property management company holding operational bank accounts in trust for their clients, or individuals managing properties for other corporations holding bank accounts for those other corporations; and
• A lawyer’s specific or general trust account.

If you have any questions, give us a call now!