- Property you received as a gift from a third party, such as a parent, is exempt from division under Alberta's Family Property Act.
- Gifts between spouses or partners are not exempt and are distributed on a just and equitable basis.
- Being able to show who gave the gift, when and to whom is the best way to support an exemption claim.
Parents and relatives often help a couple with a down payment, a car or a cash gift. If you separate, the question is whether that help stays with the person it was meant for or goes into the pool to be shared.
This article explains the general Alberta rule, the exceptions, and how to show where a gift came from. Details of your situation, especially a gift made to both of you, can change the answer.
This article covers the law of Alberta.
The basic rule for third-party gifts
Under the Family Property Act, the Court may divide all property owned by spouses or adult interdependent partners, whether owned jointly or individually. Section 7(2) then exempts certain property from that division, including property received as a gift from a third party.
A third party means someone other than your spouse or partner, such as your parents, grandparents or a friend. What is exempt is the market value of the gift on the date fixed by section 7(2.2), which is the later of the marriage date (or the start of the interdependent relationship, where applicable) and the date you acquired the property.
What a gift exemption does not cover
- Growth in value: the difference between the exempt value and the trial-date market value is not exempt, and the Court distributes it on a just and equitable basis after considering section 8.
- Property bought with income from exempt property during the relationship is distributed on that same just and equitable basis.
- Gifts between spouses or partners are not exempt.
So a gift from your mother stays outside the pool in value, but a gift from your spouse to you generally does not. Unless a section 38 agreement says otherwise, property is valued at the date of trial.
Gifts made to both spouses
Families sometimes give money to the couple together, for example by paying toward a joint home purchase. The exemption refers to property received as a gift from a third party, and the Court can divide property whether it is held jointly or individually.
How a gift to both of you is treated depends on who the giver meant to benefit and how the gift was received and recorded. That is a fact-heavy question, and a lawyer can confirm how it is likely to be treated in your case.
Whatever the outcome, the court also has a catch-all. It considers any other relevant fact or circumstance when deciding whether an equal division is just and equitable.
Showing where the gift came from
Each party must file a sworn statement disclosing all their property wherever located, including property disposed of within one year before the application. The Court of King's Bench Financial Disclosure Statement also includes a list of property claimed as exempt under section 7. If you claim a gift as exempt, you should expect to explain why.
- Bank records showing the gift arriving in your account, with date and amount.
- A short signed note or letter from the giver stating it was a gift and who it was for.
- Records of what the funds were used for, such as a purchase agreement or transfer statement.
- Documents that show the value when you received it.
- Any repayment records, if there is a question whether it was a gift or a loan.
Whether a transfer was a gift or a loan can matter a great deal, so written evidence from the time is valuable.
What to do next
Start collecting the records above before you separate, if you can, and avoid moving the funds around in ways that blur their source. Mixing a gift with other funds or investing it in a shared asset may affect how it is treated, and the answer depends on the facts.
Timing matters too. A spouse generally has 2 years from separation to apply, and adult interdependent partners have 2 years from when they knew or should have known the relationship ended. A lawyer can help you assess your claim and your deadlines.
Frequently asked questions
Is a gift from my parents divided if we separate?
Generally its market value is exempt as a gift from a third party. Growth in its value is not automatically exempt and is shared on a just and equitable basis.
Is a gift from my spouse exempt?
No. Gifts between spouses or partners are distributed on a just and equitable basis rather than being exempt.
What if the gift was made to both of us?
The exemption speaks of property received as a gift from a third party, but how a joint gift is treated depends on the facts. A lawyer can review who the giver meant to benefit.
How do I prove something was a gift?
Gather bank records, a note from the giver and records of how the money was used. You will also be listing exempt property in sworn financial disclosure.
Sources
- Family Property Act s. 7(1) — kings-printer.alberta.ca
- Alberta.ca – Dividing property between unmarried partners — alberta.ca
- Alberta Courts – Financial Disclosure Statement — albertacourts.ca
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
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