Bare trust reporting is back for 2026: what family offices should map before year-end

November 2026 · Tax

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Summary: After three years of waivers, bare trusts with a December 31, 2026 year-end face a real filing obligation, and the work starts with knowing where they are.

For most advisory teams, bare trust reporting has been a story of false starts. The original rules arrived for 2023, were waived by the Canada Revenue Agency (CRA) shortly before the first deadline, were waived again for 2024, and then set aside for 2025. It would be easy to assume the issue has gone quiet. It has not. The rules have been rewritten, they are now law, and the first year that counts ends on December 31.

Where the rules stand now

Bill C-15, the first budget implementation act for Budget 2025, received Royal Assent on March 26, 2026. Among many other measures, it replaced the original bare trust reporting rule with a narrower regime. According to practitioner commentary, the original rule was repealed retroactively, so bare trusts are outside the reporting regime for 2024 and 2025. The 2023 year was handled through administrative relief from the CRA rather than legislation.

The new obligation applies to taxation years ending on or after December 31, 2026. The CRA's own T3 guidance, updated in October 2026, confirms that certain bare trusts may need to file a T3 return, including Schedule 15 (beneficial ownership information), for those years. For an arrangement with a December 31, 2026 year-end, the T3 and Schedule 15 are due 90 days later, on March 31, 2027.

Two practical points are easy to miss. First, a bare trust needs a trust account number to file, and that can be requested ahead of time. Second, practitioner guidance suggests that winding up a bare trust during 2026 may not remove the obligation to file for 2026.

What counts as a bare trust

The new rule looks at arrangements where one or more legal owners hold property for one or more beneficial owners and can reasonably be considered to act as their agent. For reporting purposes, the legal owners are treated as trustees and the beneficial owners as beneficiaries. A titleholder who has real, independent duties or discretion over the property is not a bare trustee.

In a family office or investment counsel setting, the arrangements that tend to surface are familiar ones:

  • a nominee corporation holding real estate or shares on behalf of an operating company or another family entity;
  • a parent or child added to title or to an account for convenience, financing or probate reasons;
  • property held by one family member on behalf of a sibling, or by one entity on behalf of a partnership or joint venture;
  • farmland or other real property registered to individuals but used and economically owned by a corporation or partnership.

None of these is unusual. The difficulty is that they are often documented in a lawyer's file or a land registry rather than in the records an advisory team looks at every day.

The exemptions, and why they still require a decision

Bill C-15 widened the exemptions considerably. Based on practitioner summaries, the main ones fall into two groups.

The listed-trust exemptions apply to trusts generally. They include trusts that have existed for less than three months, trusts whose assets total $50,000 or less in fair market value throughout the year, and a family exemption where every trustee and beneficiary is an individual, each beneficiary is related to each trustee, and qualifying low-risk assets total $250,000 or less throughout the year. Lawyers' general trust accounts are also exempt.

The bare-trust-specific exemptions, effective from 2026, cover cases such as:

  • mirror ownership, where the legal owners and beneficial owners are the same people, which captures ordinary spousal joint accounts;
  • related individuals holding property that could be a principal residence of at least one legal owner;
  • spousal real property that could be the holder's principal residence;
  • partnership property held by general partners where the partnership files a T5013.

The words "throughout the year" matter. A threshold test that must hold for the whole year cannot be settled by looking at a December statement. If an account held for an adult child crossed $250,000 in June and fell back below it by December, the family exemption may not be available. That makes the exemptions less of a shortcut and more of an analysis that needs data from across the year.

The cost of getting it wrong

From the 2026 year, the ordinary late-filing penalty applies again: $25 a day, with a minimum of $100 and a maximum of $2,500 per return, whether or not any tax is owed. Where a failure to file is knowing or grossly negligent, including ignoring a CRA demand to file, the penalty is the greater of $2,500 and 5% of the highest total fair market value of the trust's property during the year.

For a family with a nominee company holding a commercial building, 5% of the property's peak value is not a rounding error. Penalties for 2023 to 2025 were removed through CRA relief, so this is the first year in which the full regime applies in practice.

A working plan before year-end

For an investment counsel firm or multi-family office, the advisor is rarely the person who files the T3. The accountant or tax lawyer usually does that. What the advisory team can do, and often does better than anyone else, is find the arrangements and assemble the facts. A reasonable sequence:

  1. Inventory every legal-versus-beneficial split. Go through each family's structure and list any asset where the name on title, the account or the share register differs from the person or entity that actually owns it economically. Include nominee companies, joint accounts with adult children, and property held for partnerships.
  2. Record the parties and their relationships. The family exemption turns on whether each beneficiary is related to each trustee. That needs a clear record of who is related to whom, not just who is on the account.
  3. Track values across the year, not just at year-end. For anything near the $50,000 or $250,000 thresholds, gather month-end or high-water values for 2026.
  4. Match each arrangement to an exemption, or flag it as reportable. Write down the reasoning. If the CRA asks later, a dated note explaining why an arrangement was considered exempt is useful.
  5. Hand off early. Send the list, the supporting documents and the open questions to the family's accountant well before the March 31, 2027 deadline, and request trust account numbers where needed.
  6. Set the date. Put March 31, 2027 on the calendar for each reportable arrangement, with an internal reminder several weeks earlier.

Closing thoughts

Bare trust reporting is less about the form and more about visibility. The families most at risk are not the ones with exotic structures; they are the ones where a convenience arrangement made fifteen years ago never made it into anyone's records. Firms that model legal and beneficial ownership separately, with the relationships between people and entities recorded alongside the key dates, will find this exercise far easier. That kind of structure-first view is what we built Mozaiik's wealth map to provide, and it will matter again every March from here on.

This article is general information, not tax or legal advice. Confirm the treatment of any specific arrangement with a qualified tax professional.

Sources

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