- The underused housing tax no longer requires a return or payment for 2025 and later calendar years, but filing and payment still apply to 2022, 2023 and 2024.
- For this tax a trust is not a person, so the trustee who owns the residential property is the owner and files Form UHT-2900 if an affected owner.
- CRA treats a bare trust as a trust for the excluded-owner rules, so a corporation owning as trustee of a bare trust has to file.
You may own a residential property through a trust arrangement, or be the person on title for someone else. When the underused housing tax (UHT) came in, many people in that position were unsure who counted as the owner and who had to file.
This article explains how the UHT treated trusts and bare trusts, and what has changed for recent years. Your situation depends on the facts, so a lawyer or accountant can confirm how this applies to you.
This article covers Canadian federal tax law, which applies in every province.
Does the underused housing tax still apply?
For 2025 and later calendar years, affected owners do not need to file a UHT return or pay the tax. That is a significant change if you were worried about future years.
The earlier years are different. Filing and payment still apply to the 2022, 2023 and 2024 calendar years. If you held a residential property through a trust in one of those years and you are not sure whether a return was needed or filed, it is worth reviewing with a professional.
Be careful with any information suggesting the tax is being wound up. That does not mean the tax applies to 2025 onward, and the rules for the earlier years still matter for balances, penalties and audits.
What a bare trust means for this tax
CRA describes a bare trust for UHT purposes as one where the trustee holds legal (titled) ownership of the trust property. The person who benefits from the property is the beneficiary, but legal title sits with the trustee.
This matters because the UHT Act defines an owner as a person who could reasonably be considered an owner based on a land registration system. A beneficiary who is not on title is therefore not an owner under that test.
Compare that with a regular trust, where the trustee holds and manages property under a trust document with real powers and duties. In a bare trust the trustee is only an agent holding legal title.
Who was the owner and who filed
For the UHT, a trust is not a person. The trustee who owns the residential property is treated as the owner, and that trustee files Form UHT-2900 for the year if they are an affected owner.
CRA interprets the word trust to include a bare trust for the excluded-owner rules. In practice, a corporation that owns property as trustee of a bare trust has to file.
| Question | How the UHT treated it |
|---|---|
| Is a trust a person? | No |
| Who is the owner? | The trustee who owns the property |
| Is a beneficiary who is not on title an owner? | Not under the land registration test |
| Which form did the trustee file? | Form UHT-2900, if an affected owner |
Do not confuse the UHT with bare trust T3 reporting
The UHT is separate from the income tax trust reporting rules. Under those rules, bare trusts need not file a T3 or Schedule 15 for taxation years ending on or after December 31, 2024 and before December 31, 2026.
Reportable bare trusts are subject to the trust reporting rules for taxation years ending on or after December 31, 2026. The end of UHT filing for 2025 does not change that.
What to do next
- Confirm which calendar years you owned the property and whether it was residential.
- Check whether a UHT return was required for 2022, 2023 or 2024 and whether one was filed.
- Work out who is on title, since the owner for UHT is the trustee who owns the property.
- Keep in mind that your arrangement may have income tax reporting duties from the 2026 year onward.
- Speak with a lawyer or accountant about any year where you are unsure.
Frequently asked questions
Do I have to file a UHT return for 2025?
No. Affected owners do not need to file a UHT return or pay the tax for 2025 and later calendar years. Filing and payment still apply to 2022, 2023 and 2024.
Is the beneficiary of a bare trust the owner for UHT?
Generally not. The UHT Act looks at who could reasonably be considered an owner based on a land registration system, so a beneficiary who is not on title is not an owner under that test. The trustee who owns the property is the owner.
Does a bare trust count as a trust for UHT?
CRA interprets trust to include a bare trust for the excluded-owner rules. So a corporation that owns as trustee of a bare trust has to file.
Does the end of UHT filing mean I have no trust reporting to do?
No. The UHT is a separate tax from the income tax trust reporting rules. Reportable bare trusts are subject to those rules for taxation years ending on or after December 31, 2026.
Sources
- CRA – T3 Trust Guide 2025 — canada.ca
- CRA – Enhanced reporting rules for trusts and bare trusts: FAQ — canada.ca
- CRA – Questions and Answers on the Underused Housing Tax — canada.ca
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
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