Can My Parents Gift My Down Payment in Canada? (2026)
Gifted down payments are common and fully allowed in Canada. Here's how the gift letter works, who can give one, whether it's taxed, and what lenders need to see.
Gifted down payments are common and fully allowed in Canada. Here's how the gift letter works, who can give one, whether it's taxed, and what lenders need to see.
With home prices what they are, family help has become one of the most common ways first-time buyers reach a down payment — and lenders are completely comfortable with it. A gifted down payment is allowed across Canada, as long as it's documented correctly. Here's exactly how it works.
The short answer
Yes — your parents (or an immediate family member) can gift your down payment in Canada. The lender requires a signed gift letter confirming the money is a genuine gift, not a loan, and may ask for proof the funds were received. There's no gift tax in Canada, so the gift itself isn't taxed. See gifted down payment options.
The gift letter
This is the key document. A gift letter states that the funds are a true gift with no expectation of repayment, names the giver and their relationship to you, states the amount, and confirms it isn't a loan. Lenders insist on this because a hidden loan would be an undisclosed debt that affects your ability to repay. The letter is simple and your broker or lender provides the template.
Who can give a gifted down payment?
Lenders generally accept gifts from immediate family — parents, grandparents, siblings, and sometimes a spouse or child. Gifts from more distant relatives or friends are scrutinized more closely or may not be accepted, because the "immediate family" rule is how lenders keep gifts genuine. If your giver isn't immediate family, talk to a broker about how to structure it.
What lenders need to see
- A signed gift letter (the core requirement).
- Proof of the funds — often a bank statement showing the gift deposited into your account.
- Sometimes proof the giver had the funds, depending on the lender and amount.
Deposit the gift into your account a little before closing so it's clearly traceable — last-minute transfers can slow things down.
Is a gifted down payment taxed?
Canada has no gift tax, so receiving the gift doesn't create a tax bill for you, and giving it doesn't for your parents. (Other tax situations — like a parent selling investments to fund the gift — are separate matters for the giver and unrelated to your mortgage.) Always confirm complex situations with a tax professional.
How it fits your purchase
A gifted down payment counts toward your minimum down payment just like savings, so it can get you to 5%, 10%, or 20% sooner — lowering your mortgage and possibly your CMHC insurance. Combine it with the FHSA and HBP for an even larger down payment, and confirm your target in how much down payment you need. It's a normal part of the first-time buyer process.
Frequently asked questions
Can my parents gift me money for a down payment?
Yes. Gifts from immediate family are allowed across Canada, provided you supply a signed gift letter confirming it's a genuine gift and not a loan.
Do I pay tax on a gifted down payment?
No — Canada has no gift tax, so receiving the gift isn't taxable for you and giving it isn't taxable for your parents.
What is a gift letter?
A signed statement naming the giver and their relationship, the amount, and confirming the money is a true gift with no repayment expected. Lenders require it for gifted down payments.
Who can give a gifted down payment?
Generally immediate family — parents, grandparents, and siblings. Gifts from others are scrutinized more closely or may not be accepted.
Getting family help? Talk to us — we'll handle the gift letter and documentation so your gifted down payment closes smoothly. See gifted down payment options.
Mortgage content produced by Mortgage Squad Advisors' team of FSRA-licensed mortgage advisors and reviewed under the supervision of the brokerage's Principal Broker (FSRA Brokerage #13737) before publication.