HST on short-term rentals and Airbnb in Ontario

Is your rental taxable or exempt?

GST/HST treats a rental by how long the same guest stays and what you charge per day. CRA's GST/HST Memorandum 19.2.2, Residential Real Property: Rentals and its page on platform-based short-term accommodation draw the lines this way:

So a cottage, condo or basement suite rented by the night or week on Airbnb, Vrbo or a similar site is usually taxable short-term accommodation. A unit rented to the same tenant for a month or longer is usually exempt, and you do not charge HST on that rent. Because the property is in Ontario, the place of supply is Ontario and the rate is 13% HST, whichever province your guests come from.

Who collects the HST: you or the platform?

It depends on whether you are registered for GST/HST. CRA says an accommodation platform operator that facilitates taxable short-term stays for suppliers who are not registered is required to charge and collect the GST/HST on those stays. If you are registered, you continue to be required to charge and collect the tax yourself, including on stays booked through a platform.

Airbnb’s help page for Canadian hosts says the same thing in practice: for hosts who are not registered it collects and remits the tax, and registered hosts need to provide their GST/HST number so Airbnb does not add tax on top of their price. The platform's own booking or service fee is a separate supply, and CRA says the platform charges HST on it at the rate where the property is located.

Example: a four-night stay at an Ontario cottage

A host rents a Muskoka cottage for four nights at $180 a night, so the accommodation is $720.00. The place of supply is Ontario, so the HST is 13%:

If the host is not registered, the platform charges the $93.60 and sends it to CRA. If the host is registered, the host charges the $93.60, reports it on their GST/HST return and remits it, and can generally claim input tax credits for the HST paid on expenses for the rental.

When a host has to register

The usual small supplier rule applies. CRA's “When to register for and start charging the GST/HST” page says you are a small supplier, and do not have to register, if your taxable sales do not exceed $30,000 over four consecutive calendar quarters. Taxable short-term rentals count toward that total. Exempt long-term rents are not taxable supplies. Once you pass $30,000 you have to register, and you may choose to register voluntarily before then. Our guide to the $30,000 small supplier rule explains the timing in detail.

Registering is not only about charging tax. Rules for residential property, such as a change in how a home is used, can have their own GST/HST effects, so it is worth asking a qualified tax professional before you register for a rental you also live in.

Receipts for guests who book directly

Guests who book through a platform get the platform's receipt. If you also rent directly, CRA's charge and collect page says you must tell customers whether GST/HST applies and show the rate, either as a separate amount or with a clear statement that the price includes HST. A numbered, carbonless receipt book keeps a copy for your records and one for the guest.

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