Can a Parent Add a Child to the Title of Their House in Ontario Without Causing Problems After Death?
Yes, a parent can add an adult child to title, but it often creates problems rather than avoiding them. In Ontario, when a parent transfers a house into joint names with a capable adult child for no payment, the law presumes the child holds the property on resulting trust for the parent, which means for the estate after death.
The child can try to rebut that presumption by proving the parent intended a gift at the time of the transfer, on a balance of probabilities. Evidence from around the time of the transfer carries the most weight, and later evidence is treated with caution if it is self-serving or reflects a change of intention.
If the house is held for the estate, it is available to pay the deceased's debts and may affect what the other beneficiaries receive. On death, a taxpayer is deemed to have disposed of capital property at fair market value, though some or all of the gain on a principal residence may be exempt. A lawyer can help you weigh these points before you change title.
Key takeaways
- A parent's transfer of a house into joint names with a capable adult child raises a rebuttable presumption that the child holds it in trust for the parent, and so for the estate.
- The person claiming a gift must prove the parent's contrary intention at the time of the transfer, on a balance of probabilities.
- Evidence from around the time of the transfer matters most, and later self-serving evidence is treated with caution.
- Tax on death and the rights of other beneficiaries depend on the facts, so speak with a lawyer before you change title.