Canadian airbnb taxes – a quick ways to make money with your money guide airbnb hosting tips

Of primary importance is that hosts are documenting expenses and ways to make money with your money retaining receipts to reduce the impact of tax assessments, come CRA filing time. Credit card receipts don’t cut it with the agency, as these don’t identify specific items purchased. You need to present the CRA with an actual receipt. This includes receipts for all the little things that make ways to make money with your money your property special – bathing products, toothbrushes, a selection of special teas, or coffee. That means that hosts are on the hook for every ways to make money with your money single penny earned.

But on the upper tier of expenses, hosts should be aware that there are two different types ways to make money with your money of expenses adhering. These are current expenses and capital cost allowance (CCA). The first type applies to property tax, utilities and routine maintenance, like repairs or painting. These can be claimed as a percentage of income. The second type applies to either the creation or renovation ways to make money with your money of the facility (construction or large scale overhauls – not just cosmetic changes).

While the status of your property changes once you begin ways to make money with your money renting a portion of it, there are some important distinctions you should be aware of. For example, a hosting property may still be considered a principle residence ways to make money with your money if the rental area is reasonably small, in terms of the total area of the property. Two out of five rooms is an acceptable proportion of ways to make money with your money your total property. That 2/5ths represents 40% of your total expenses, which is what you should claim. More than that and your principle residence status changes.

As detailed above, any structural changes to the property to create a rental ways to make money with your money space, or claiming CCA for those changes, can also change the status of the property as a ways to make money with your money whole. For this reason, it’s counseled that hosts not claim CCA. The effect is that capital gains tax adheres to the ways to make money with your money property’s future sale and this can make quite a dent ways to make money with your money on your ROI (return on investment). However, you can go ahead and claim CCA on furniture and ways to make money with your money equipment, so long as those are not permanent structural.

Hosts should also be keenly aware that the CRA is ways to make money with your money catching up to the sharing economy, having added a line item to personal income tax forms, asking for the urls of income-generating sources and the percentage of income earned at these ways to make money with your money sources. If this income is not reported and the CRA becomes ways to make money with your money aware of it, airbnb hosts can be subject to penalties and interest (and nobody likes those). Rental or business tax?

Another important consideration for hosts is determining whether monies earned ways to make money with your money from the rental property will be viewed as rental or ways to make money with your money business income. The CRA will take into account services rendered. How many of these and the nature of the services ways to make money with your money offered can change the status of your hosting income in ways to make money with your money the eyes of the agency. Rental income includes standard services common to all rentals, like electricity, heat, in suite laundry facilities and parking. But if you provide services like security, meals, or cleaning, you will most probably be considered a business under the ways to make money with your money tax code. When it comes to HST/GST, if your income from hosting exceeds $30,000 you have to register and pay the applicable tax. When it comes to PST, things vary from province to province.

Quebec is a little more complicated in that there is ways to make money with your money GST, QST, and tax on lodging. You do not have to register for GST/HST or QST if your revenues do not exceed $30,000 in a four-quarter period. However, the tax on lodging applies regardless of your total revenues ways to make money with your money and varies depending on the tourism region that your rental ways to make money with your money is located in. Here are some resources to help you navigate:

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