🏠 T1079 – Designation of a Property as a Principal Residence by a Personal Trust

Form T1079 from the Canada Revenue Agency (CRA) is used by eligible personal trusts to designate a property as their principal residence for a given taxation year. This designation can reduce or eliminate capital gains tax on the property when it is sold. ([canada.ca](https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/t1079.html))

📥 Download the Form

You must download the accessible fillable PDF and open it with Adobe Acrobat Reader 10 or later (do not fill it directly in your browser):

• T1079 accessible fillable PDF — current year (e.g., 2025) version.
• Printable PDF version — print and complete by hand.

📍 Who Uses Form T1079?

This form is relevant when a personal trust (e.g., alter‑ego trust, spousal trust, joint spousal trust, or certain disability trusts) owns a property, and the trust wants to claim the principal residence exemption to reduce capital gains tax on that property. The trust must meet specific criteria to be considered an “eligible trust.”

• Trust holds the property as an eligible housing unit during the taxation year.
• Specified beneficiary ordinarily inhabited the property that year or met special election conditions.
• Property is designated for one trust taxation year at a time.

💡 Why This Matters

In Canada, the principal residence exemption can eliminate or reduce capital gains tax on the sale of a home. Personal trusts may qualify for a similar exemption if the property is properly designated — but the rules are technical and differ from individual claims. Using T1079 correctly ensures the trust benefits from the exemption and complies with CRA regulations.

🧠 How to Complete the Form

• Identify the trust and specify the property being designated.
• Include trust taxation year details and identify the “specified beneficiary.”
• Calculate the portion of the capital gain eligible for the principal residence exemption by entering relevant years or fractions.

Note: T1079 may also require reference to related worksheets or guidance, such as the worksheet for capital gains exemption calculations (see the CRA Principal Residence Worksheet, e.g., T1079WS).

📊 Related CRA Guidance

• Trusts and taxation — overview of trust tax rules and obligations.
• Guide T4037 – Capital Gains — general capital gains guidance, including exemptions.

📌 Practical Tips

• ✔ Always use the most updated version of T1079 for the taxation year you are filing.
• ✔ Ensure the trust meets CRA’s definition of an “eligible trust” before designating a property.
• ✔ Keep detailed records of ownership periods and calculations used to support the exemption claim.
• ✔ Consult a tax professional if the trust or property situation is complex, especially with multiple beneficiaries.