• About
  • Offices
  • Careers
  • News
  • Students
  • Alumni
  • Payments
  • EN | FR
Background Image
Bennett Jones Logo
  • People
  • Expertise
  • Knowledge
  • Search
  • FR Menu
  • Search Mobile
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
View all
Practices
Corporate Litigation Regulatory Tax View all
Industries
Energy Infrastructure Mining Private Equity & Investment Funds View all
Advisory
Crisis & Risk Management Public Policy
View Client Work
International Experience
Insights News Events Subscribe
Arbitration Angle Artificial Intelligence Insights Business Law Talks Podcast Class Actions: Looking Forward Class Action Quick Takes
Economic Outlook New Energy Economy Series Quarterly Fintech Insights Quarterly M&A Insights Sustainability & the CIO
People
Offices
About
Practices
Industries
Advisory Services
Client Work
Insights
News
Events
Careers
Law Students
Alumni
Payments
Search
Subscribe

Stay informed on the latest business and legal insights and events.

LinkedIn LinkedIn Twitter Twitter Vimeo Vimeo
 
Blog

New Trust Reporting Rules

August 18, 2020

Written By Barbara Kimmitt, Marissa German and Allyson Cairns-Walji

Beginning in 2021, new reporting rules come into effect for most Canadian resident trusts. The rules are intended to improve the collection of beneficial ownership information with respect to trusts and to help the CRA assess the tax liability for trusts and its beneficiaries. Trustees and their advisors should be aware of the rules summarized below.

1. New Filing Requirement

The new filing requirement requires express trusts that are resident in Canada to file a T3 return, even if the trust does not have any income to report.

Express trusts are trusts created with the settlor or testator’s explicit instructions, as evidenced by a Trust Deed or a Will.  Resulting trusts and constructive trusts are not express trusts.

2. New Annual Information Reporting Requirement

The new reporting requirement applies to all trusts that are required to file a T3 return. Every year during the trust’s existence, the trustees must provide the name, address, date of birth, residence and taxpayer identification number for all of the following persons in relation to the trust:

  • settlor;
  • all current trustees;
  • all beneficiaries (including contingent beneficiaries); and,
  • any person who has the ability (through the trust terms or a related agreement) to exert control over trustee decisions regarding the appointment of income or capital of the trust, such as a Protector.

Trustees must provide the additional information in a new schedule with the trust’s T3 return.

3. Exceptions to the New Rules

The following trusts are exempt from the new filing and reporting requirements:

  1. trusts in existence for less than three months at the end of 2021;
  2. trusts that hold assets with a total fair market value that does not exceed $50,000 throughout the year if the assets are comprised of cash, certain government debt obligations or listed securities;
  3. certain regulated trust accounts, such as a lawyer’s general trust account; 
  4. trusts that qualify as a registered charity or non-profit organization;
  5. mutual fund trusts, segregated funds and master trusts;
  6. graduated rate estates and qualified disability trusts;
  7. employee life and health trusts;
  8. certain government funded trusts;
  9. trusts under or governed by registered plans such as RRSPs, RESPS, RRIFs and TFSAs; and 
  10. cemetery care trusts and trusts governed by eligible funeral arrangements.

4. Penalties for Non-Compliance

Failure to file the T3 return or provide the schedule of additional information will lead to a penalty of $25 per day of delinquency, with a minimum penalty of $100 and a maximum penalty of $2,500.
If the failure to file was made knowingly or due to gross negligence, an additional penalty is payable in the amount of 5 percent of the highest value of property held during the relevant year by the trust, with a minimum penalty of $2,500.

Existing penalties in respect of the T3 return will continue to apply.  

Please note that this publication presents an overview of notable legal trends and related updates. It is intended for informational purposes and not as a replacement for detailed legal advice. If you need guidance tailored to your specific circumstances, please contact one of the authors to explore how we can help you navigate your legal needs.

For permission to republish this or any other publication, contact Amrita Kochhar at kochhara@bennettjones.com.

Download PDF

Author

  • Barbara J. Kimmitt KC Barbara J. Kimmitt KC, Partner

Related Links

  • Insights
  • Media
  • Subscribe

Recent Posts

Blog

Workplace Investigations: Perfection Is Not the Standard

May 21, 2025
       

Blog

Government of Canada Doubles Funding for Federal Indigenous [...]

May 20, 2025
       

Blog

Sector Snapshot: Private Equity Increasingly Hungry [...]

May 20, 2025
       

Blog

Fintech in Canada Q1 2025

May 16, 2025
       

Blog

Tenant Due Diligence Essentials in British Columbia

May 15, 2025
       
Bennett Jones Centennial Footer
Bennett Jones Centennial Footer
About
  • Leadership
  • Diversity
  • Community
  • Innovation
  • Security
Offices
  • Calgary
  • Edmonton
  • Montréal
  • Ottawa
  • Toronto
  • Vancouver
  • New York
Connect
  • Insights
  • News
  • Events
  • Careers
  • Students
  • Alumni
Subscribe

Stay informed on the latest business and legal insights and events.

LinkedIn LinkedIn Twitter Twitter Vimeo Vimeo
© Bennett Jones LLP 2025. All rights reserved.
  • Privacy Policy
  • Disclaimer
  • Terms of Use
Logo Bennett Jones