CanadaIf I transfer property to my child for free, is it presumed to be a gift or held in trust?
In Canada, a gratuitous transfer of property to a child is presumed to be held in trust (a resulting trust) unless the transferor clearly intended it as a gift.
What the Law Says
Canadian common law applies presumptions when property is transferred without payment (gratuitously). No federal or provincial statute codifies the presumption of resulting trust for parent-to-child transfers — it is judge-made law rooted in equity.
When someone transfers property to another person for no money or other value (i.e., 'without consideration'), courts presume that the recipient holds it in trust for the transferor — this is called a 'resulting trust'.
This presumption applies to transfers between parents and adult children. It does not depend on family relationship alone — unlike the outdated 'presumption of advancement', which historically favoured gifts to wives and minor children but has been largely rejected in Canada for adult children.
The burden is on the recipient (e.g., the child) to prove, with clear evidence, that the transferor truly intended a gift — not just that they didn’t ask for payment.
What Courts Have Said
The Supreme Court of Canada confirmed the enduring role of the presumption of resulting trust in gratuitous transfers — especially where no gift intention is established.
The Court held that when property is transferred from a parent to an adult child without consideration, the law presumes a resulting trust — meaning the child holds title for the parent’s benefit — unless the child proves the parent intended an outright gift. The older presumption of advancement does not apply to adult children in Canada.
What to Do
Document your intention clearly at the time of transfer — e.g., sign a written gift declaration stating you intend the transfer as an irrevocable gift.
Keep supporting evidence: emails, letters, witness statements, or contemporaneous notes confirming the gift intent.
If you’re the child receiving property, gather proof of gift intent before disputes arise — especially if the parent later becomes incapacitated or dies.
Consult a lawyer before transferring real estate or significant assets to avoid unintended trust consequences or estate challenges.
Sources
Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-08.