- For years ending in 2025, CRA does not expect bare trusts to file a T3 or Schedule 15, so there may be nothing late.
- If a return was late, the penalty depends on whether tax was unpaid, and a bare trust with no unpaid tax faces $25 a day, with a minimum of $100 and a maximum of $2,500.
- Whether to simply file, ask for relief or use voluntary disclosure depends on the facts and is worth confirming with a lawyer or accountant.
If you act as trustee for a bare trust and have not filed in earlier years, the first question is whether anything was actually due. Under CRA's current approach, many bare trusts had no filing obligation yet.
This article walks through that check, explains the late-filing penalties if a return was required, and sets out what to weigh before you contact CRA.
This article covers Canadian federal tax law, which applies in every province.
First, check whether a filing was due
CRA does not expect bare trusts to file a T3 return, including Schedule 15, for taxation years ending in 2025. Its guidance says bare trusts are not subject to the trust reporting rules for taxation years ending on or after December 31, 2024 and before December 31, 2026, and for 2023 CRA likewise said it would not require bare trusts to file.
Schedule 15 applies to trusts that must file, so a bare trust that is not required to file for 2025 has nothing to file. Reportable bare trusts are caught for taxation years ending on or after December 31, 2026, with first returns due 90 days after year-end, which is March 31, 2027 for a December 31 year-end.
That relief is administrative, so it is worth confirming with a lawyer or accountant whether CRA has contacted you or the trust directly.
When a missed filing may be a different kind of trust
Not every arrangement called a bare trust is one. A regular express trust that is resident in Canada and not a listed trust must file a T3. A trustee holding real powers under a trust document is in that category, not the bare trust category.
Some trusts are exempt from filing, including those that existed less than three months or held assets of $50,000 or less throughout the year. Certain trusts with only individual trustees and related individual beneficiaries, total fair market value of at most $250,000, and only listed low-risk assets are also exempt. Whether any of this fits depends on the details, and a lawyer or accountant can confirm.
How the late-filing penalties work
The T3 return, and any balance owing, is due no later than 90 days after the trust's tax year-end. If that date falls on a weekend or CRA-recognized holiday, the next business day applies.
| Situation | Penalty |
|---|---|
| T3 or Schedule 15 information late, tax unpaid | 5% of the unpaid tax, plus 1% of it for each full month late, to a maximum of 12 months |
| Demand to file issued and a late-filing penalty already assessed in any of the three preceding years | May be 10% of the unpaid tax, plus 2% for each full month late, to a maximum of 20 months |
| No unpaid tax on the due date | $25 a day, minimum $100, maximum $2,500 |
| Knowingly or through gross negligence making a false statement or omission, or failing to file, for a non-listed trust | The greater of $2,500 and 5% of the highest fair market value of the trust property |
A bare trust usually has no tax payable, so the $25 a day penalty is the likely one. A reportable bare trust that is also a listed trust is not required to file unless it is requested to file.
File, ask for relief, or disclose?
These are different routes, and whether voluntary disclosure suits your situation is worth confirming with a lawyer or accountant. Filing late simply brings the return in. A request for penalty relief asks CRA to reduce or cancel a penalty. Whether a bare trust exists at all is a question of fact, and CRA says it cannot give definitive determinations on whether a trust exists. Each route has its own conditions, so the right choice depends on your facts, including whether CRA has already contacted you, and it is worth confirming with a lawyer or accountant.
Some points apply whichever route you take. Missing Schedule 15 information, such as tax identification numbers, leaves the schedule incomplete and the trust has not met its filing obligations. Schedule 15 asks for name, address, date of birth for individuals, country of residence and a tax identification number for all trustees, settlors, beneficiaries and controlling persons. A person who fails to give their tax identification number to the trustee may face a $100 penalty for each failure.
On the T3 for a reportable bare trust, only the fields marked with a check mark need completing, and if there is no governing document name you list the beneficial owner's legal name followed by the word Trust. The income and gains themselves belong on the beneficial owner's own return.
What to do next
- Confirm the tax year-ends involved and whether each year ended in 2025 or earlier.
- Check whether CRA has sent any letter or demand to file.
- Decide whether the arrangement is really a bare trust or a regular trust.
- Gather names, addresses, dates of birth and SINs for everyone Schedule 15 covers.
- Check that the beneficial owner has reported the income and gains on their own return.
- Talk to a lawyer or accountant before filing, asking for relief or approaching CRA about disclosure.
Frequently asked questions
Do I owe a penalty for not filing a bare trust return for 2025?
CRA does not expect bare trusts to file a T3 return, including Schedule 15, for taxation years ending in 2025. Whether you have a bare trust at all is a question of fact, so how this applies to your own arrangement, and whether CRA has contacted you, is worth confirming with a lawyer or accountant.
What is the likely penalty if a required return is late?
A bare trust usually has no tax payable, so the alternative penalty of $25 a day, with a minimum of $100 and a maximum of $2,500, is the likely one. Where tax is unpaid, the penalty is 5% of it plus 1% for each full month late, to a maximum of 12 months.
When is the first bare trust return due?
Reportable bare trusts are caught for taxation years ending on or after December 31, 2026. For a December 31, 2026 year-end the return is due March 31, 2027.
Should I use voluntary disclosure?
It depends on your facts, including whether a filing was actually required and whether CRA has already contacted you. A lawyer or accountant can tell you whether filing, a relief request or voluntary disclosure fits.
Sources
- CRA – T3 Trust Guide 2025 — canada.ca
- CRA – Important updates to the trust reporting requirements for the 2025 taxation year — canada.ca
- CRA – Enhanced reporting rules for trusts and bare trusts: FAQ — canada.ca
- CRA – When to file a trust's T3 return — canada.ca
- CRA – T3 Trust Guide (T4013) — canada.ca
- Justice Laws – Income Tax Act s. 150 — Justice Laws (federal)
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
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