Co-owner or partner?
Amounts are claimed differently depending on whether the taxpayer is a co-owner or a partner.
For example, for co-owners, the CCA for each owner must be entered separately, whereas in a partnership, each partner’s portion of the CCA is calculated based on the partnership share.
To help you choose the right type for your client, here’s what the CRA says:
“Most of the time, if you own the rental property with one or more persons, we consider you to be a co-owner. For example, if you own a rental property with your spouse or common-law partner, you are a co-owner.
In some cases, if you are a co-owner, you have to determine if a partnership exists. A partnership is a relationship between two or more people carrying on a business, with or without a written agreement, to make a profit. If there is no business in common, there is no partnership. That is, co-ownership of a rental property as an investment does not in itself constitute a partnership.”
From the CRA T4036 Rental Income Guide.