New Trust Reporting Requirements – You may have to file a trust return!
Did you know that new trust reporting requirements were introduced affecting trusts for years ending after December 30, 2023?
Per these new rules, all trusts, unless certain conditions are met, must file a T3 Trust Return, and schedule 15 – Beneficial Ownership Information of a Trust, on a yearly basis.
Information that must be provided includes:
- Identity of trustees, beneficiaries, and settlors of the trust;
- Identity of anyone who has control or can overrule trustee’s decisions (‘controlling person’ through trust terms or an agreement) on income or capital distributions.
Further, bare trusts (i.e. holding property on behalf of beneficial owners) have to file an annual T3 Return (even though there is no income to report as income is reported on beneficial owner’s return). Consequently, many trusts that did not have to file trust T3 returns before, are required to do so now.
There are some trusts that will not be required to provide additional information. These include:
- mutual fund, segregated funds and master trusts;
- registered plan trusts (i.e., deferred profit-sharing plans, pooled registered pension plans, registered disability savings plans, registered education savings plans, registered pension plans, registered retirement income funds, registered retirement savings plans, registered supplementary unemployment benefit plans, TFSA);
- general trust accounts administered by lawyers;
- graduated rate estate trusts;
- qualified disability trusts;
- trusts qualifying as non-profit organizations or registered charities;
- trusts in existence less than three months;
- trusts holding less than $50,000 in assets throughout the taxation year (if the holdings are deposits, government debt obligations and listed securities);
If you have never filed a trust return before, note that a Trust Account Number must be obtained, before a Trust Return can be filed.
Deadline for filing T3 trust returns is March 31st for years ending on December 31st. If you have a trust or think you may have a bare trust and need assistance, please reach out for a consultation.