Thinking of Transferring Your Home to a Family Member? Read This First.

This blog is based on insights shared by John Zinati, B.A., L.L.B. of Zinati Kay Barristers & Solicitors, Toronto. We're sharing it because it directly affects homeowners we work with every day.

We see it more often than you'd think.

A homeowner hits a rough patch financially, maybe there's a tax issue, maybe things have gotten complicated, and someone suggests: "Just put the house in your spouse's name. Problem solved."

Here's the real answer: it's not that simple, and a recent Tax Court of Canada decision proves exactly why.

What Actually Happened

In Gill v. The King, 2026 TCC 18, a taxpayer facing a significant income tax assessment transferred 99% of his interest in the family home to his spouse and son for next to nothing. He likely thought he was protecting the asset.

The result? CRA assessed the recipients personally for the unpaid tax. The very people he was trying to protect ended up on the hook.

3 Things Every Ontario Homeowner Needs to Know

1. Transferring property below market value can shift the tax liability to the person who received it.

Canadian tax law gives CRA the ability to pursue family members who receive property from someone who owes taxes, if they paid less than fair market value for it. Putting the house in someone else's name doesn't make the problem disappear. In some cases, it just passes the problem along with the deed.

2. "I didn't know about the debt" isn't a defence.

The recipients in this case argued they were unaware of the tax debt and had actually contributed financially to the home over the years. The court wasn't persuaded. Under subsection 160 of the Income Tax Act, what matters is the transfer itself and whether fair market value was paid, not whether the recipient knew what was going on.

Innocent doesn't mean exempt.

3. Giving the property back later doesn't erase the exposure.

One of the recipients eventually gave up their interest in the property. The court confirmed it didn't matter. The liability was triggered at the time of the original transfer and it stayed.

Why This Matters to You

At Laframboise Mortgage, we work with a lot of homeowners who are restructuring, refinancing, or navigating complicated financial situations. We're not tax lawyers, and this is exactly why we have trusted partners like the team at Zinati Kay in our corner.

The lesson here isn't "never transfer property to family." Sometimes there are very good reasons to do it. The lesson is: do it carefully, do it with legal guidance, and definitely do it before tax trouble shows up, not after.

Real estate is often the biggest asset on the table. It deserves a strategy, not a quick fix.

Before You Make Any Moves

If you're thinking about transferring property, refinancing, or restructuring how your home is held, talk to a real estate lawyer first. And if you're wondering how a change in ownership might affect your mortgage options, we're always happy to walk through that with you too.

Our advice is free and could save you thousands.

Big thank you to John Zinati, B.A., L.L.B. of Zinati Kay Barristers & Solicitors for the original insight. With nearly 30 years of experience and almost 30,000 transactions closed, they're exactly the kind of partner we trust to flag the things that matter. You can reach them at www.zinatikay.com or 416-321-8766.

Want to talk through how your mortgage and property structure work together? Never be too shy to call. 289-645-1568