Can My Parents Gift My Down Payment in Canada? (2026)

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.

Can the gift come from outside Canada?

Yes. A gift from a parent living abroad is treated the same as one from a parent in Canada — there is no gift tax here, and the money can go toward your down payment as long as it is a genuine gift with no expectation of repayment. What changes is the paperwork, not whether it's allowed.

Expect the lender to look harder at where the money came from. Alongside the gift letter, lenders typically want the funds transferred into your own Canadian bank account rather than sent straight to the lawyer from overseas, the wire or transfer records showing the sender and the originating account, and some evidence of the giver's source of funds. That is standard anti-money-laundering diligence, not suspicion of you — and it is the step that most often delays an international gift. The exact documentation varies by lender and by the size of the transfer, so confirm what yours needs before the money moves, and allow extra time for the transfer to land and be verified.

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.

Can my parents gift me a down payment from another country?

Yes. Funds sent from abroad are allowed and are not taxed in Canada. Beyond the gift letter, the lender will want the transfer records and evidence of the giver's source of funds, and the money should land in your own Canadian account with enough time to be verified before closing.

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.