CRA indicates that a deemed trust (e.g., under s. 149(5)) is not subject to Sched. 15 reporting if it satisfies the historical s. 150(1.1)(b) T3 filing exception

Where a deemed trust pursuant to s. 149(5) arises over the property of a non-profit organization (NPO), for example, a bank account, would the deemed trust be required by Reg. 204.2(1) to submit a Sch. 15 with its T3 return for each year?

CRA indicated that, based on its understanding that a deemed trust is not an express trust, s. 150(1.2) would not override the exemption in s. 150(1.1)(b) from filing a T3 return if the deemed trust had no Part I tax payable for the year (for example, if pursuant to s. 149(5)(f), its property income was under $2,000) and there were no relevant dispositions in the year. If the deemed trust was required to file a T3 return because the s. 150(1.1)(b) exemption did not apply, then it would indeed be required by Reg. 204.2(1) to include a Sched. 15. However, since the deemed trust does not have a settlor or beneficiaries, it would not need to complete that part of the Schedule 15 – but it would, however, be required to report the trustee of the deemed trust referred to in s. 149(5)(b) or (c).

Perhaps the point of interest is that, on its face, Reg. 204.2(1) appears to require any trust to file Sched. 15 if it is not subject to one of the exceptions listed in ss. 150(1.2)(a) to (o) – so that the Regulation does not seem to explicitly acknowledge the s. 150(1.1)(b) filing exemption. Thus, CRA may implicitly be acknowledging the principle (see, e.g., Auer and McNeeley), that a regulation cannot override or undercut a provision of the Act.

Neal Armstrong. Summary of 27 August 2025 External T.I. 2025-1057461E5 under Reg. 204.2(1).