T1141 – Information Return in Respect of Contributions to Non-Resident Trusts, Arrangements or Entities

Form T1141, Information Return in Respect of Contributions to Non-resident Trusts, Arrangements or Entities must be filed by a person who was resident in Canada at the specified time, and who was a contributor, connected contributor or a resident contributor to the non-resident trust, arrangement or entity at that time.

Specified time of a trust means the trust's year end. If the trust no longer exists, the specified time is the time that is immediately before it ceases to exist.

Although contributor, connected contributor and resident contributor are defined terms, the Income Tax Act may deem a person to be contributor, connected contributor or resident contributor.

This form is filed for the taxation year of the non-resident trust, arrangement or entity that ends in the reporting person's taxation year.

Example A Co., a resident corporation, transferred property to a non-resident trust on December 1, 2014. A Co. has a taxation year that ends October 31, 2014. The trust has a taxation year that ends December 31, 2014. Since Form T1141 is filed for the trust's taxation year that ends in A Co.'s taxation year, A Co. should report the transfer of December 1, 2014 on the T1141 return filed for its 2015 tax year. This is because the transfer occurred in the trust's taxation year that ended on December 31, 2014 which ended in A Co.'s taxation year that ends in 2015.

A person that is one of the following at the specified time is not required to file this form:

1. a mutual fund corporation;
2. an exempt person;
3. a mutual fund trust;
4. a trust described in any of paragraphs (a) to (e.1) of the definition “trust” in subsection 108(1);
5. a registered investment;
6. a trust in which all persons beneficially interest are persons described in (a) to (e) above; or
7. a contributor to the particular trust by reason only of being a contributor to another trust that is resident in Canada and is described in any of (b) to (f) above.

An individual (other than a trust) does not have to file a Form T1141 for the year in which the individual first becomes a resident of Canada [section 233.7].

Partnerships are not required to file this form; instead, each partner of the partnership who is resident in Canada is required to file this form.

Where two or more persons are otherwise required to file Form T1141, one of the persons can elect in writing to have the other person file the return on his or her behalf. However, if the person so designated does not file the return or files a return containing false statements or omissions, the person electing may be liable to any penalty that may result as though that person had failed to file the return or had made the false statement or omission.

Contributions to the following trusts are not required to be reported

• an exempt foreign trust as defined by paragraph (c) to (h) of that definition in subsection 94(1);
• a trust governed by a foreign retirement arrangement such as a U.S. Individual Retirement Account (IRA);
• a non-resident trust that does not pay income tax in the taxing jurisdiction where it is resident, principally provides superannuation, pension, retirement or employee benefits, and is either maintained primarily for the benefit of non-resident individuals, or is governed by an employee profit sharing plan; and
• a trust where the interest of each beneficiary under the trust is described by reference to units, provided it complies with the following prescribed conditions:

• there are at least 150 beneficiaries who are beneficiaries in respect of the same class of units of the trust; and
• at least 150 of those beneficiaries each hold at least one "block of units" of that class (as defined in subsection 4803(1) of the Income Tax Regulations, and units of that class having a total fair market value of at least $500.

Only certain corporations are permitted to elect to use a functional currency pursuant to subsection 261(3).

Where an election has been made, the currency code must be reported on the top of page 1 of the Form T1141 Summary. The codes for the functional currencies are as follows:

AUD – for Australian dollar
USD – for U.S. dollar
GBP – for U.K. pound
EUR – for Euro

For a list of country codes, see the CRA website at: https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4061/nr4-non-resident-tax-withholding-remitting-reporting-2016.html.

Section 1 – Reporting person information

Tick the appropriate box to identify the type of the person filing this form. Provide the person's name, address and identification number. Provide the taxation year for which this form is being filed.

For individual code, tick:

1. If the individual or the individual's spouse is self-employed.
2. If the individual and the individual's spouse are both not self-employed.

Section 2 – Certification

This area should be completed and signed by:

• the person filing this form in the case of an individual;
• an authorized officer in the case of a corporation; or
• the trustee, executor, or administrator where the person filing the return is a trust.

If a person or firm other than the reporting entity prepared this form, provide their name, address and telephone number.

A nil amount should be reported by indicating "0" (zero) rather than leaving the amount or fair market value field empty. Amounts should be rounded to the nearest dollar.

Foreign currency reporting and conversion

Report monetary values in Canadian dollars except where an election has been made to use a functional currency.

When converting amounts into Canadian dollars or functional currency, you should use the exchange rate in effect at the time of the transaction. Use the exchange rate in effect at year-end to report year-end balances. If contributions or distributions are made throughout the year, we will accept an average rate for the year.

Section A – Identification of non-resident trust, arrangement or entity

Pursuant to subsection 233.2(4.1), certain transfers and loans by a taxpayer to an arrangement or entity other than a trust could result in the taxpayer becoming obligated to file Form T1141 for that arrangement or entity. Tick the relevant box to identify if this filing is required because of subsection 233.2(4.1).

Provide the account number issued by the CRA if one has been provided.

Section B – Decision making information regarding the trust, arrangement or entity

Provide all requested information at the specified time.

Person(s) who have any powers relating to the trust include:

• the power to change the governing law or status of the trust;
• the power to veto distributions of capital or income; and
• the power to remove existing trustees and appoint new ones.

Section C – Settlors of the trust, arrangement or entity

Provide all requested information at the specified time. If the entity or arrangement is not a trust or a corporation, provide these details for persons with similar capacity with respect to the entity or arrangement.

Section D – Beneficiaries of the trust, arrangement or entity

Provide all requested information at the specified time. If the entity or arrangement is not a trust or a corporation, provide these details for persons with similar capacity with respect to the entity or arrangement.

Section E – Information on transactions and balances

If the property contributed, distributed or lent is funds (e.g., money, negotiable instruments) use the amount of the funds contributed. Where property is other than funds, the fair market value of the property at the time of the contribution should be used.

Estimating fair market value

There is no requirement to obtain a formal appraisal of the property. An estimate of the fair market value is sufficient. The following sections will help you estimate the fair market value of certain properties.

Securities

The fair market value of publicly traded shares may be obtained from public listings of transactions on recognized stock exchanges, investment publications, or from a broker or investment dealer.

For securities in a privately owned business, information may be obtained from a person who is familiar with the business such as an accountant or business valuator.

For more information, see Information Circular 89-3, Policy Statement on Business Equity Valuations.

Listed personal property and other personal-use-property

The fair market value of these properties may be estimated by consulting with art, coin, jewellery, antique and stamp dealers. You can also refer to catalogues for the value of these objects.

Real estate

The fair market value of real estate may be estimated by collecting information on sales of similar properties in the same area around the date you received the property. This information can be obtained from real estate pamphlets, which provide asking prices. If possible you should determine if the property sold and what the actual sale price was. You can also use newspapers which provide the asking price or land-registry or land-title offices.

To support your valuation, you should keep documents containing the following information:

• a brief description of the property, including location, lot, building size, and date and type of construction;
• the cost and date of acquisition;
• the cost of any additions or improvements;
• the property assessment for municipal tax purposes; and
• insurance coverage.

Contributions to the trust, arrangement or entity before the end of its taxation year

Report property contributed to the non-resident trust before the end of its taxation year that was not reported on prior T1141 forms.

Contributions generally result from a transfer or loan of property to the trust. However, an indirect transfer or loan could also result in a contribution to the trust, arrangement or entity. Contributions by others could also be deemed to be your contributions.

Distributions from the trust, arrangement or entity before the end of its taxation year

Report distributions from the non-resident trust before the end of its taxation year that were not reported on prior T1141 forms. Indicate in the appropriate box whether this was a distribution of income or of capital for income tax purposes.

Non-arm's length persons indebted to the trust, arrangement or entity during its taxation year

Report indebtedness identified on prior T1141 forms if it was still outstanding at any time during the taxation year of the non-resident trust.

Provide the largest amount owed at any time during the taxation year of the non-resident trust, the interest rate applicable to the amount owed, and the amount owed at the taxation year-end of the non-resident trust.

Maximum amount outstanding during the taxation year and amount outstanding at year end include accrued interest. Maximum amount outstanding during the taxation year may be based on the maximum monthend amount outstanding.

Interest rate is the applicable per annum rate.

Persons to whom the trust, arrangement or entity was indebted during its taxation year

Report indebtedness identified on prior T1141 forms if it was still outstanding at any time during the taxation year of the non-resident trust.

Provide the largest amount owed at any time during the taxation year of the non-resident trust, the interest rate applicable to the amount owed and the amount owed at the taxation year-end of the non-resident trust.

Maximum amount owed during the taxation year and amount owed at year end include accrued interest. Maximum amount owed during the taxation year may be based on the maximum month-end amount owed.

Interest rate is the applicable per annum rate.

Section F – Due diligence exception

Tick the relevant box to indicate whether any of the information requested on this return was not available at the time of filing. If any information is not available, specify what information is not available and why. Also explain the steps taken to obtain the information.

The information required to be filed on Form T1141 does not include information that is not available to the filer on the day that the return is filed, provided:

• there is reasonable disclosure in the return of the unavailability of the information;
• before that day, the person exercised due diligence to obtain the information;
• it was reasonable to expect, at the time of each transaction, if any, entered into by the person or partnership after March 5, 1996, that gives rise to the requirement to file the return or that affects the information to be reported in the return, that sufficient information would be available to the person or partnership to comply with the reporting requirements; and
• if the information subsequently becomes available to the person or partnership, it will be filed no more than 90 days after it becomes available.

Section G – Attachments

Attach the following documents to this return:

• non-resident trust's constituting documents which set out the terms of the non-resident trust
• memoranda of wishes
• financial statements for the taxation year
• a copy of any amendments to the above documents

The constituting documents and memoranda of wishes need only be attached in the first year of filing.

Due dates for filing this return

Form T1141 for a tax year of a non-resident trust that ends in the reporting person's tax year must be filed on or before the due date of the reporting person's income tax return. If an income tax return is not required to be filed, Form T1141 must still be filed on or before the date that would be the filing due date of the income tax return.

Please note that currently Form T1141 cannot be filed electronically. If you are not required to file an income tax return or if you have e-filed your income tax return, you are still required to file a paper copy of this form to the following address:

Winnipeg Taxation Centre
Data Assessment & Evaluation Programs
Validation & Verification Section
Foreign Reporting Returns
66 Stapon Road
Winnipeg MB  R3C 3M2

Penalties

There are substantial penalties for failing to complete and file the Form T1141 accurately and by the due date. For additional information regarding penalties, see the CRA website at: https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/foreign-reporting/table-penalties.html.

Voluntary disclosures

To promote compliance with Canada's tax laws, we encourage you to correct your tax affairs through the Voluntary Disclosures Program. For more information, see Information Circular IC00-1R4, Voluntary Disclosures Program or visit the CRA website.

More information

If you need more information, visit our website at canada.ca/taxes. Alternatively you can call general enquiries at:

• 1-800-959-5525 for businesses and self-employed individuals; or
• 1-800-959-8281 for individuals (other than self-employed individuals) and trusts.

You may also contact your local tax services office. Our addresses and fax numbers are listed on our website and in the government section of your telephone book.

Privacy Notice

Personal information is collected under the authority of section 233.2 and is used to monitor compliance with the foreign reporting requirements related to non-resident trusts, arrangements or entities. Information may also be used for the administration and enforcement of the Act, including assessment, audit, enforcement action, collections, and appeals, and may also be disclosed under information-sharing agreements in accordance with the Act. Incomplete or inaccurate information may result in various compliance actions, including the assessment of monetary penalties.

Your Social Insurance Number is the authorized number for income tax purposes under section 237 and is used under certain federal programs.

Information is described in personal information bank CRA PPU 035 in the Canada Revenue Agency chapter of the Info Source publication at canada.ca/cra-info-source. Personal information is protected under the Privacy Act and individuals have a right of protection, access to, and correction of their personal information. Further details regarding requests for personal information at the CRA can be found at https://www.canada.ca/en/revenue-agency/corporate/about-canada-revenue-agency-cra/access-information-privacy-canada-revenue-agency.html.