If you earn income from Airbnb, VRBO, or other short-term rental platforms in Canada, you have both federal income tax and potentially GST/HST obligations. The rules tightened significantly in 2024, including the requirement for platforms to report host income to the CRA. Here's what you need to know to stay compliant and minimize your tax bill.
Yes — all income earned from short-term rentals is taxable in Canada. You must report it on your T1 personal tax return. The income is generally treated as rental income (T776) unless you provide hotel-like services (daily cleaning, meals, concierge), in which case it becomes self-employment income (T2125) — a distinction that can affect which deductions are available and whether you pay CPP contributions.
Unlike long-term residential rentals, short-term accommodation (less than 30 consecutive days) is subject to GST/HST. If your total short-term rental revenue exceeds $30,000 in any 12-month period, you must:
Once registered, you can claim Input Tax Credits (ITCs) on the GST/HST you paid for eligible expenses related to your rental.
| Province | Key Regulations | Tax Notes |
|---|---|---|
| Ontario | Municipal licensing (Toronto, Ottawa require registration) | HST 13% if over threshold |
| British Columbia | STR must be primary residence in most municipalities | GST 5% if over threshold |
| Quebec | Class C tourism establishment registration required | QST + GST if over threshold |
| Nova Scotia | Tourism accommodation regulations apply | HST 15% if over threshold |
For the portion of the year/property used for short-term rental:
If you convert part of your principal residence to short-term rental use and claim CCA on the rental portion, this triggers a "change in use" and can affect your principal residence exemption when you eventually sell. It is generally advisable to avoid claiming CCA on your primary residence rental portion to preserve the full exemption.
Non-residents of Canada who earn rental income from Canadian property must withhold and remit 25% of gross rents to the CRA (or file under Section 216 to pay tax on net income instead). Airbnb may withhold taxes for non-resident hosts under the non-resident withholding rules.
Keep your Airbnb income separate with a dedicated KOHO account. No monthly fees, real-time transaction tracking, and cashback on business expenses.