How to file a T3 return

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Overview
Filing a T3 return online
Supporting documentation for online filing
Filing a T3 return on paper 

Overview

Effective January 8, 2018, trust administrators and their representatives may be eligible to file their T3 return electronically through the Internet file transfer service.

Filing a T3 return online

Eligibility for online filing

Internet file transfer (IFT) is available to most taxpayers and tax preparation service providers when a trust’s taxable income, tax payable, and refundable credits are $0.00. For more information on other T3 Trust returns and documents available for electronic filing, see Submitting and filing electronic documents to the T3 Estate and Trust Return programs.

Restrictions for online filing

You cannot use Internet file transfer to file a trust return if:

  1. The amount at line 56, line 84 or line 94 is greater than 0.00.
  2. The return is for a taxation year that ends before 2017.
  3. The trust has not been provided with a trust account number or is unable to provide one in the electronic file.
  4. The trust is a Specified investment flow-through (SIFT) trust (code 028).
  5. The trust is subject to deemed dispositions on form T1055 in the year.
  6. The trust is reporting:
    1. Gross-up amounts of dividends at line 49
    2. Reserves on form T3SCH2 or at field 1170 of form T3SCH1
    3. Capital gains on gifts of certain capital property on form T3SCH1A
  7. The trust is subject to minimum tax and has a net adjusted taxable income for minimum tax (field 12270 of T3 schedule 12) that is greater than 0.00.
  8. The trust is filing form RC199, Voluntary Disclosures Program (VDP) Taxpayer Agreement or the taxpayer is making a request to the Voluntary Disclosures Program.
  9. The trust went bankrupt and is filing its pre or post-bankruptcy return.
  10. The return is an amended tax return.

Before you file online

Before filing with internet file transfer, the trust’s identification information must be up to date. You cannot use IFT to change the identification information such as, the trust:

  • name
  • legal representative (trustee/executor/administrator)
  • legal representative’s address
  • alternate mailing address, if different from the legal representative’s address
  • direct deposit information (nor can direct deposit be requested)

Web access code

To file a trust return online using Internet file transfer, you will need a Web access code (WAC). If you have an existing WAC that was issued to file your trust-related information returns, you can use the same one. If you have misplaced or do not have a WAC, go to Web access code to use our online service. If you cannot access your WAC online or would like to change it, call the Business Enquiries line at 1-800-959-5525.

Internet File Transfer

Online filing for trust returns is only available for 2017 and later tax years. Certain conditions must be met in order to file a trust return online, see Restrictions for online filing.

Steps in filing a T3 return online

  1. Download the schema or use your software to create and save your return in XML format. If your file size is more than 150 MB, you may have to submit fewer returns per file.
  2. Make sure you have your Web access code and your trust account number. If you do not have your Web access code, you can get one at Web access code.
  3. To submit electronically, go to Internet file transfer (XML) .

Supporting documentation for online filing

What is required

Note

In this part, all elections, designations, agreements, waivers, and special elective returns are referred to as elections.

Only elections and Form T1135, Foreign Income Verification Statement are required to be sent if they apply to the return you filed. You do not have to submit any other supporting documentation when filing online, even if it would be required when filing on paper. Keep all documentation used to prepare a return, such as, books, records, forms, schedules, and receipts for six years. Be ready to send this documentation to the Canada Revenue Agency (CRA) on request.

Some elections are made on authorized CRA forms, while others are made by providing specific information in a letter/note format. All elections, including supporting documentation for those elections, must be sent to the CRA in writing, unless otherwise indicated. For an election to be considered valid, the CRA must receive the election no later than the due date given in the Income Tax Act.

Where to send the documents

With the exception of Form T1135, all paper documentation to support elections should be sent to the tax centre that serves the area where the legal representative lives. Each election form and letter should include the trust’s name, representative’s name, address, and trust account number. A covering letter should also be included that indicates the documentation is in support of the trust’s electronically filed return.
 
Send your completed Form T1135, Foreign Income Verification Statement, to the tax centre address shown on the form.

Filing a T3 return on paper

Where you file the return depends on where the trustee address is based. Generally, we consider a trust to reside where the trustee, executor, administrator, liquidator, or other legal representative who manages the trust or controls the trust’s assets lives. It is the jurisdiction in which the central management and control is factually exercised that will be considered in determining the residence of the trust. For more information go to Where to file a T3 return.

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