Trust Account for Quebec Condo Managers

Managing the funds of a divided co-ownership syndicate requires impeccable rigour. When the condominium manager collects and pays on behalf of the syndicate, the “trust account” becomes a central tool for protecting co-owners’ money and reassuring the board of directors (board).

This article summarizes the key rules for a trust account held by a condominium manager in Quebec, along with concrete practices to implement. The goal is to prevent commingling of funds, limit risks and document effective controls, while remaining compliant with the Civil Code of Quebec and meeting co-owners’ expectations.

Information current as of 2026-06-20.

The legal framework in Quebec: what the board needs to know

In Quebec, a syndicate of co-owners is a separate legal person. When it entrusts financial administration to a condominium manager, the manager generally acts as a mandatary and as an “administrator of the property of another” within the meaning of the Civil Code of Quebec. This entails specific duties: loyalty, prudence and, above all, separating the property being administered from the manager’s own property.

In practical terms, the syndicate’s money must never end up in the condominium manager’s operating account. The funds must be kept in a separate, identified and reconciled account to avoid any confusion (see administration of the property of another under the Civil Code of Quebec, LégisQuébec: https://www.legisquebec.gouv.qc.ca/fr/document/lc/CCQ-1991).

It is also important to keep in mind that the “trust account” used by condominium managers is not necessarily a trust in the strict sense of the provisions on trusts as an appropriation of property. Rather, it is a separate account intended to protect funds belonging to others, with account-rendering and record-retention obligations.

Specific co-ownership requirements also apply: the contingency fund must be separate from current administration and deposited in the syndicate’s name, as provided by the Civil Code of Quebec for divided co-ownership (see the provisions on the contingency fund, particularly section 1071 of the Civil Code of Quebec, on LégisQuébec: https://www.legisquebec.gouv.qc.ca/fr/document/lc/CCQ-1991).

How a condominium manager’s trust account works

Several configurations are possible. The two most common are:

• A bank account opened in the syndicate’s name, with operational access granted to the condominium manager under the mandate. This is the clearest and generally recommended configuration. The funds always remain in the syndicate’s name, which facilitates oversight by the board and auditing.
• A condominium manager’s trust account, with sub-accounts for each syndicate. The manager maintains a master trust account and a detailed register for each syndicate to allocate deposits and withdrawals. This model requires increased discipline: subsidiary ledgers, periodic reconciliations and dual-approval mechanisms.

Regardless of the option selected, three principles apply:

1. Separation of funds: no commingling with the condominium manager’s own funds or between syndicates. The contingency fund remains separate from current administration.
2. Access controls: the bank signing and payment-approval policy must be in writing (board resolution), attached to the management agreement and recorded in the annual general meeting minutes.
3. Traceability: each transaction must be supported by a document (invoice, contract, purchase order) and recorded in a register.

To structure these mechanisms and responsibilities (for example, who approves what and at which threshold), see how professional financial management fits into the broader mandate: https://www.multirent.ca/services/#gestion-financiere.

Deposits, payments and reconciliations: essential controls

• Deposits: condo fees (common expenses), special assessments, penalties permitted under the by-laws of the immovable and other revenue (for example, renting part of a common portion) must be deposited in full, without withholding, into the syndicate’s designated account. Deposit descriptions must make it possible to quickly identify the source (unit, period, nature).
• Payments: withdrawals must follow a documented approval chain. For example, the condominium manager collects invoices, verifies compliance (contract, signed work order, presence of a contractor’s licence when required), then submits them to the board or authorized signatories according to the approval matrix. Before paying any contractor, verify the licence’s validity with the Regie du batiment du Quebec (RBQ): https://www.rbq.gouv.qc.ca/.
• Bank reconciliations: at least monthly, and ideally throughout major projects. The reconciliation includes the bank balance, outstanding entries, the general ledger and an accounts-payable aging report. The board should receive a summary, together with an up-to-date income statement and balance sheet.
• Collusion and errors: reduce risks by separating duties (entry, approval, signing). Requiring two bank signatures above a threshold, or written approval from a director, remains a simple and effective measure.
• Documentation: keep electronic records in a structured folder organized by financial year and type (common expenses, projects, insurance claims). Financial policies may be attached to the declaration of co-ownership or the by-laws of the immovable to strengthen co-owner buy-in.

Interest, bank fees and tax implications

Interest generated by accounts in the syndicate’s name belongs to the syndicate. Depending on the banking agreement, this interest must be credited to the appropriate fund (administration or contingency), in accordance with the investment policy authorized by the board and recorded in the minutes.

Bank fees related to the trust account must be clearly identified. They are usually operating expenses of the syndicate and should be presented in the financial statements. Make sure the management agreement specifies who is responsible for which fees (for example, bank fees, platform fees and certified-cheque fees) to avoid any ambiguity.

For tax purposes, certain investment income (for example, interest) may create reporting obligations. Even if a syndicate does not carry on commercial activities, it remains a legal person. Consult Revenu Quebec for the rules applicable to non-profit organizations and interest income: https://www.revenuquebec.ca/fr/entreprises/impots/organismes-sans-but-lucratif/ and the section on business interest income: https://www.revenuquebec.ca/.

Also consider the impact on contingency-fund cash flow. The maintenance logbook (EUC) and the repayment plan for major projects may justify opening a separate account or a specific savings product, under the board’s authority and in compliance with the Civil Code of Quebec provisions on the contingency fund.

Is a trust account mandatory for the condominium manager?

No single rule requires all condominium managers to use a trust account structured according to a specific model, as is the case for regulated professions (for example, real estate brokers, who are governed by the OACIQ and its trust-account rules: https://www.oaciq.com/). In co-ownership, the framework is established primarily by the Civil Code of Quebec (administration of the property of another), the management agreement, the declaration of co-ownership and the by-laws of the immovable.

In practice, a separate account is essential to maintain the separation of funds and provide an account of administration. Many syndicates require, by contract, an account in the syndicate’s name and approval mechanisms. Others accept a condominium manager’s trust account with named sub-accounts, provided that the monthly account-rendering is detailed and an independent reconciliation is possible.

Important reminder: the contingency fund must remain separate, be deposited in the syndicate’s name and be managed according to the rules specific to divided co-ownership (Civil Code of Quebec, section 1071, LégisQuébec: https://www.legisquebec.gouv.qc.ca/fr/document/lc/CCQ-1991). Industry best practices, including those published by the RGCQ, emphasize transparency and documentation: https://rgcq.org/.

To take your internal controls further (budgets, authorizations and quarterly account-rendering), explore our administrative and financial management services: https://www.multirent.ca/services/ and browse other advice on our blog: https://www.multirent.ca/blogue/.

Best practices to implement now

• Board resolution: adopt an approval matrix (thresholds, dual signatures and exceptions) and file it with the minutes of the next annual general meeting.
• Separate accounts: at a minimum, maintain an administration account and a contingency-fund account in the syndicate’s name. Avoid commingling project funds.
• Periodic account-rendering: monthly or quarterly financial statements (balance sheet, income statement and cash flow statement), an accounts-payable list and details of special projects.
• Independent reconciliation: at least one director reviews the bank reconciliations and journal entries.
• Vendor management: systematically verify RBQ licences and certificates (insurance and CNESST) before making any significant payment.
• Traceability of condo fees: maintain accounts by unit, manage arrears, issue written notices and follow the declaration of co-ownership for any collection measure.
• Documentation: centrally archive contracts, quotes, approvals and payment documents in a manner that is accessible to the board.

FAQ

Q1. Can the condominium manager pay its own fees directly from the trust account?

A1. Yes, if the management agreement clearly provides for it and an invoice is issued and approved according to the authorization matrix. The withdrawal must be documented and appear in the account-rendering.

Q2. Who has signing authority on the account?

A2. Ideally, at least one director of the syndicate and, depending on the mandate, the condominium manager for operational matters. Many syndicates require two signatures for amounts above a threshold defined by resolution.

Q3. Where should accumulated interest be deposited?

A3. The interest belongs to the syndicate. It is credited to the corresponding fund (administration or contingency) and recorded in the financial statements.

This article provides general information and does not constitute legal advice. Consult a lawyer or notary for your situation.

This article provides general information and does not replace advice from a tax professional or accountant. Refer to Revenu Quebec and the CRA for the exact requirements.

Do you manage a co-ownership in Quebec? Explore our plans or contact us to assess your needs.