Is it true that one way to avoid the taxes that come with cottage inheritance would be to have a parent put the child’s name on the deed through something the lawyers call “love and affection”?

—Ross D. Neureuther, via e-mail

Lawyers? Love and affection? John Johnson of Ottawa law firm Nelligan O’Brien Payne says he’s never even heard those terms together in the same sentence. But seriously: The legal expression is “natural love and affection.” It means “no money is changing hands as consideration for the transfer,” explains Johnson. The transferor (in this case, a parent) gives the property to another person (the child) for free. All the parent gets in return is “love and affection.” (It beats “anger and bitter resentment.”)

The transfer you’re proposing is a way to avoid the estate administration tax, or what used to be called probate fees. If you put your child’s name on the cottage deed as a joint tenant “with right of survivorship,” when you die, the property will not pass through your estate or be subjected to that tax, says Johnson. But as for the dreaded capital gains tax…sorry. No amount of love and affection will prevent it or stave it off.

Capital gains are automatically triggered by a property transfer. When depends on “whether the proposed joint ownership involves a gifting of beneficial ownership in the property, or just a splitting of legal title to the property,” explains Karen Slezak, a tax partner with Soberman in Toronto. If the parent gifts beneficial ownership to the child (meaning the child handles carrying costs, determines how the property is used, and “in all material respects” treats the property as his or her own), capital gains are triggered immediately, says Slezak. If the parent, on the other hand, retains beneficial ownership (keeping his or her name on the deed), capital gains aren’t triggered until the parent dies.