Does a Bare Trust Holding Title Affect the New Housing Rebate Claim in Canada?

This answer covers Canadian federal tax law, which applies in every province.

Whether the person who really owns the home can claim depends on how the purchase is structured, and bare trusts raise questions worth settling before you close. The rebate is for an individual who acquires a new home as their own or a relation's primary place of residence, where total consideration is under $450,000. Only individuals can claim, partnerships and corporations cannot, and an individual cannot claim if a partnership or corporation co-owns the house.

How a bare trust or nominee is treated for this rebate depends on the facts, and a lawyer can confirm how the rules apply to your arrangement. Whether a bare trust changes who counts as the purchaser depends on the trust terms and the purchase agreement, so both are worth reading together. Where several people own a home, only one individual can claim, the rebate is paid to that claimant, and it can apply if all other conditions are met by at least one of the individuals.

Intent to use the house as a primary residence must be evident at the outset, and the application deadline is generally two years after ownership transfers. Because the answer turns on the documents, have a lawyer or accountant review them before closing.