New tax ruling could spell trouble for short-term rental owners

Things could start to get more complicated for those who rent out their property on a regular basis.

That was Former President of Ontario Real Estate Association Ray Ferris.

That unwelcome surprise comes thanks to a recent ruling.

Ferris gave an example of just how that would add up.

The good news is it won’t apply to everyone.

While the sale of a previously occupied residential property is generally exempt from HST, the Tax Court of Canada ruled in March that the sale of a condo unit rented out on Airbnb for a number of short-term leases was subject to the tax.

It’s a ruling that will likely have big implications for short-term rental operators as it clarified that the CRA can charge the tax in cases similar to the ruling.

Written by Matt LeBlanc