You can own a rental property by yourself or in partnership with other owners.
Most of the time, if you own the rental property with one or more persons, the CRA considers you to be a co-owner. For example, if you own a rental property with your spouse or common-law partner, you are a co-owner.
In some cases, if you are a co-owner, you have to determine if a partnership exists.
A partnership is a relationship between two or more people carrying on a business, with or without a written agreement, to make a profit. If there is no business in common, there is no partnership. That is, co-ownership of a rental property as an investment does not make a partnership. To help you determine if you are in a partnership, see the partnership law for your province or territory. For more information, see Income Tax Folio S4-F16-C1, What is a Partnership?
Your share of the partnership income
A partnership that carries on a business in Canada, or a Canadian partnership with Canadian or foreign operations or investments, has to file a T5013, Partnership Information Return, for its fiscal period if either of the following occur:
- at the end of the fiscal period, the partnership has an absolute value of revenues plus an absolute value of expenses of more than $2 million, or has more than $5 million in assets
- at any time during the fiscal period:
- the partnership is a tiered partnership (has another partnership as a partner or is itself a partner in another partnership)
- the partnership has a corporation or a trust as a partner
- the partnership invested in flow-through shares of a principal-business corporation that incurred Canadian resource expenses and renounced those expenses to the partnership, or
- the minister of national revenue requests one in writing
If you are a partner in any of these types of partnerships, you should get two copies of a T5013 slip, Statement of Partnership Income. For more information on this return, go to Sole proprietorships and partnerships or see T4068, Guide for the Partnership Information Return (T5013 Forms).
If you determine that you are a partner in a partnership and you received a T5013 slip, fill in only the following fields on Form T776:
- enter your nine-digit partnership business number
- enter your rental property ownership percentage in the "Your percentage of the partnership" box
- enter the amount from box 110 (or 107 if it is a limited partnership) of your T5013 slip at amount 10
If you are in a partnership and you do not receive a T5013 slip, or if you are a co-owner, fill in all of the parts in Form T776 that apply to you. Follow the special instructions to fill in lines 8299, 9369, 9936, 9943 and 9946. Fill in "Part 2 – Details of other co-owners and partners" on the form.
Forms and publications
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