8 December 2020

New Requirement to Disclose Nominee Agreements to Revenu Québec

By: Jason Gauthier

On September 24, 2020, Bill 42, An Act to give effect to fiscal measures announced in the Budget Speech delivered on 21 March 2019 and to various other measures (“Bill 42“) was adopted.

Required Disclosure

Bill 42 requires a taxpayer who is a party to a nominee agreement entered into in the course of a transaction having income tax consequences under the Taxation Act (Québec) to disclose the agreement and the transaction to Revenu Québec (“RQ”).

A nominee agreement is an agreement under which one person (the principal) nominates another person (the nominee) to enter into an agreement with a third party on the principal’s behalf, often without informing the third party that the nominee is acting on the principal’s behalf. Nominee agreements are often used in real estate transactions whereby a nominee will hold legal and registered title to the real estate on behalf of the beneficial owner(s) of such real estate. A nominee may also hold legal title to shares of a corporation or units of a partnership on behalf of the beneficial owner(s) of such shares/units. It is important to note that nominee agreements are required to be disclosed in each of the described cases.


This disclosure requirement applies to nominee agreements that are:

  • entered into on or after May 17, 2019;
  • entered into before May 17, 2019 if the income tax consequences of the transaction continue after May 16, 2019.

Disclosure need only be made by one party to a nominee agreement. In the case of a limited partnership, disclosure is required only by the general partner.

The disclosure must be made through the prescribed form (TP-1079.PN) and must include:

  • the date of the nominee agreement;
  • the identity of the parties to the nominee agreement;
  • a complete description of the facts of the transaction that is sufficiently detailed to allow the Minister to analyze it and have a proper understanding of the tax consequences;
  • the identity of any other person or entity in respect of which the transaction has tax consequences; and
  • such other information as is required by the prescribed form, including a copy of the nominee agreement.

Deadline to Disclose

Nominee agreements must be disclosed by the later of:

  • December 23, 2020; or
  • 90 days after the conclusion of the nominee agreement.

Failure to Disclose

Failure to disclose the required information to RQ:

  • may result in penalties of $1,000 and an additional $100 per day for each day the failure continues up to a maximum of $5,000 per nominee agreement; and
  • suspends the prescription period for reassessment for as long as the required disclosure remains undisclosed.

Shared Disclosure

The tax record of a person is confidential. No information contained in a person’s tax record may be used or communicated unless the person provides consent or the use or the communication is authorized by the Tax Administration Act, which provides for limited exceptions to the prohibition of the communication of information contained in a person’s tax record. With that said, it is not clear how this information may be used internally by the tax authorities in connection with their review of other tax matters related to the parties to the nominee agreement or the property which is subject thereto.


For any questions relating to your own disclosure obligations with respect to an agreement that could qualify as a “nominee agreement”, please consult with your accountant or trusted tax advisor.

Back to blog