GST/HST for Non-Resident Rentals: What You Need to Know
GST/HST for non-resident rentals is a key compliance requirement for property owners listing Canadian short-term accommodations on platforms like Airbnb, VRBO, or Booking.com. Even if you live outside Canada, understanding these rules can help you avoid penalties and maximize your tax recovery.
Even if you’re not living in Canada or do not have a permanent establishment here, you may still be required to register for GST/HST and collect taxes on rental income. Platforms may collect taxes on your behalf, but this doesn’t exempt you from registration, reporting, or remittance responsibilities under Canadian tax law. Understanding GST/HST for non-resident rentals helps avoid missed registration deadlines and audit risks from the CRA.
Visit the CRA’s non-resident tax page for foundational information.
Do Platforms Like Airbnb Handle GST/HST for You?
A common misconception among non-resident rental owners is that platforms like Airbnb, VRBO, or Booking.com automatically handle all tax obligations. While these platforms may collect and remit GST/HST in some provinces, this does not eliminate your obligation to register with the CRA, track income, and remit GST/HST yourself.
In fact, Airbnb itself advises that “you may still need to register and file returns even if taxes are collected on your behalf.” Always confirm whether the taxes shown on your bookings are being remitted by you or the platform—especially if you use multiple platforms or manage direct bookings.
Relying solely on platforms can leave gaps in your compliance with GST/HST for non-resident rentals, especially when managing multiple properties or channels.
For CRA platform rules, visit their platform-based accommodation page.
GST/HST for Non-Resident Rentals: Defining Non-Resident Status
A non-resident is typically defined by the Canada Revenue Agency (CRA) as someone who doesn’t have significant residential ties in Canada and doesn’t stay in Canada for more than 183 days in a tax year. However, simply earning rental income from Canadian property can trigger tax obligations, regardless of your official residency.
The CRA treats short-term rental income as business income. So, even without a fixed address or employees in Canada, you may still be seen as “carrying on business” in Canada, which brings with it GST/HST for non-resident rentals obligations.
If you’re unsure about your status, consult a tax professional or check the CRA’s guidance on residency status.
Thresholds and GST/HST Registration Requirements
The GST/HST registration threshold for all businesses—including non-resident rental owners—is $30,000 in gross taxable revenue over the past four consecutive calendar quarters.
Once you exceed this amount, you must register for GST/HST. However, even if your revenue is below this limit, voluntary registration allows you to claim Input Tax Credits (ITCs) for GST/HST paid on expenses like repairs, advertising, or property management. Many landlords choose to voluntarily register early to streamline their compliance with GST/HST for non-resident rentals.
For details on setting your tax rates correctly in booking software, see our Ultimate Guide to Setting Up Provincial GST/HST Rates.
Section 216 Filing for Non-Residents
Under Section 216 of the Income Tax Act, non-resident property owners earning rental income can elect to file a Canadian return and pay tax only on net rental income, rather than gross.
Let’s look at an example:
- Gross Rental Income: $50,000
- Deductible Expenses: $18,000
- Taxable Income under Section 216: $32,000
Coordinating your income tax and GST/HST for non-resident rentals reporting can help optimize your overall tax outcome. Without Section 216, you’d be taxed 25% on the full $50,000 = $12,500. But with the election, you’re taxed on $32,000, significantly lowering your tax liability.
For bookkeeping strategies that help you maximize deductions, read our guide on Bookkeeping for Canadian Short-Term Rentals.
Input Tax Credits (ITCs)
Once registered, you can recover GST/HST paid on business expenses via Input Tax Credits. This includes:
- Cleaning and maintenance costs
- Booking platform service fees
- Marketing and advertising
- Utilities and internet
- Supplies for guests (toiletries, linens, etc.)
Make sure to keep detailed receipts and invoices with GST/HST numbers. Accurate tracking not only ensures compliance but helps maximize tax recovery. Input Tax Credits are one of the most overlooked benefits of GST/HST for non-resident rentals in Canada.
For more insight into ITC eligibility, review the CRA’s ITC documentation.
The CRA may deny your ITC claim if your receipts are missing key details like the vendor’s GST number, or if the expense doesn’t clearly support rental operations. For example, partially personal-use purchases, or costs related to a property not yet listed for rent, may be ineligible. To stay compliant, maintain an organized digital filing system for all GST-bearing receipts.
Self-Supply Rules and Change in Use
If you change the purpose of a property (from personal to rental use or vice versa), you may trigger the self-supply rules. In such cases, the CRA deems the property to have been sold and repurchased at fair market value.
Example:
You convert a personal-use condo in Vancouver into a short-term rental. You’re now required to remit GST based on the market value at the time of conversion—even if no money changed hands.
For full guidance, see the CRA publication on vacation properties.
Filing and Remitting GST/HST
If you’re registered for GST/HST, you must file regular tax returns and remit the collected GST/HST to the Canada Revenue Agency (CRA). The frequency depends on your taxable revenues:
- Annual filing: Revenue under $1.5 million
- Quarterly: Revenue between $1.5–6 million
- Monthly: Revenue over $6 million
You must include all taxable rental income, GST/HST collected, and Input Tax Credits (ITCs) claimed.
Missing deadlines can lead to:
- Late filing penalties
- Daily interest charges
- Loss of eligibility for ITCs
If your rentals are seasonal or sporadic, aligning your filing period with your rental cycle helps manage cash flow better. Properly filing GST/HST for non-resident rentals ensures you avoid late penalties and maintain eligibility for tax credits. For practical strategies, see our article on Cash Flow Management for Seasonal Tourism Businesses.
Provincial Differences in Tax Rates
While GST is consistent at 5% federally, some provinces use a Harmonized Sales Tax (HST), combining federal and provincial taxes. Rates include:
- Ontario: 13% HST
- Nova Scotia, New Brunswick, Newfoundland & Labrador, PEI: 15% HST
- British Columbia, Alberta, Saskatchewan: 5% GST (plus applicable PST)
- Quebec: 5% GST + 9.975% QST (administered by Revenu Québec)
If your property is in Quebec, you may need to register separately with Revenu Québec for QST obligations.
Ensure your booking platform supports correct regional tax rates. For more details, visit CRA’s GST/HST rates page.
Common GST/HST Mistakes Non-Residents Make
Navigating GST/HST as a non-resident can be tricky. Here are some frequent pitfalls to avoid:
- Missing the $30,000 threshold and failing to register on time
- Assuming Airbnb or VRBO handles everything — they may collect, but you’re still responsible for registration and remittance
- Not claiming eligible ITCs, losing out on recoverable expenses
- Overlooking self-supply rules when changing property use
- Incorrect or late GST/HST filings, leading to audits or penalties
One of the most common issues is underestimating how complex GST/HST for non-resident rentals can become across multiple provinces.
Another frequent issue involves currency conversion mistakes. Since CRA filings must be in Canadian dollars, you must convert any foreign income at CRA’s posted exchange rate at the time of each transaction—or use their annual average. Using incorrect rates can misstate both your revenues and your ITC claims.
We explore similar compliance issues in our article on Navigating Canadian Payroll Regulations, which offers tips relevant to remote property owners managing staff.
Case Studies: Practical Scenarios
🏡 Case Study 1: British Columbia Condo, $40K in Rental Income
Sandra, a non-resident from Australia, earns $40,000 CAD/year from her Whistler condo. She registers for GST and collects 5% on all bookings. By tracking her expenses in cloud-based software, she claims over $4,000 in ITCs annually.
🏙️ Case Study 2: Ontario Cottage, Revenue Under $30K
Luis, based in the UK, rents a cottage seasonally in Ontario. Though his annual income is $27,000, he voluntarily registers for HST (13%) to claim ITCs on $12,000 worth of landscaping and renovations.
Conclusion and Next Steps
Staying compliant with GST/HST for non-resident rentals in Canada requires more than just collecting taxes. It means understanding:
- When to register
- What expenses are deductible
- How often to file
- Which rules apply to your province
- When your property usage triggers self-supply
Managing all of this alone—especially from abroad—can be stressful. That’s why many successful rental owners partner with experts in Canadian tax compliance.
What Happens If You Don’t Register?
Failing to register for GST/HST after surpassing $30,000 in gross rental revenue may result in the CRA assessing back taxes—even on income where you didn’t charge GST/HST. You might also lose access to valuable Input Tax Credits (ITCs) for that unregistered period and face additional penalties and interest.
Non-compliance can quickly become more costly than timely registration and filing. If you’re unsure about your obligations, it’s best to consult a professional sooner rather than later. The longer you delay addressing GST/HST for non-resident rentals, the more complicated—and costly—it can become.
Support for Non-Resident Rental Owners
At Valley Business Centre – Bookkeeping & Payroll, we specialize in supporting non-resident property owners across Canada. Whether you manage a seasonal listing or a full-fledged rental business, we provide:
- Expert guidance on GST/HST for non-resident rentals
- Help with CRA registration, ITCs, and remittances
- Full-service bookkeeping, payroll, and year-end prep
- Local insights tailored to B.C., Ontario, and beyond
With over 30 years of experience, we support clients across Whistler, Squamish, the Sea to Sky Corridor, and Metro Vancouver. Our personalized services are designed to reduce your tax burden, improve recordkeeping, and give you peace of mind.
Frequently Asked Questions (FAQs)
What is the GST/HST threshold for non-resident rental owners in Canada?
Non-resident rental owners must register for GST/HST if their taxable revenues exceed $30,000 CAD in any 12-month period. This includes all short-term rental income from Canadian properties.
Do I need to collect GST/HST on Airbnb income as a non-resident?
Yes. If your gross rental revenue exceeds the $30,000 threshold, you must register for GST/HST and collect it, even if you live outside Canada. Airbnb may collect it in some provinces, but you are still responsible for registration and filing.
Can I claim Input Tax Credits (ITCs) as a non-resident?
Yes. Once registered for GST/HST, non-resident owners can claim ITCs for eligible expenses related to operating the rental—such as utilities, repairs, and advertising—provided they have proper receipts.
How does Section 216 help non-residents with tax compliance?
Section 216 allows non-resident rental owners to file a Canadian tax return on net rental income instead of paying 25% tax on gross revenue. This can result in significant tax savings.
What happens if a non-resident doesn’t register for GST/HST on time?
If you surpass the threshold and fail to register, you may be required to pay the GST/HST out of pocket, lose ITC eligibility, and face penalties or interest. Timely registration is critical for compliance.
Is there a difference in GST/HST compliance across provinces for non-residents?
Yes. Each province has its own tax rules. For example, Quebec has its own QST system, while Ontario and PEI use HST. Non-residents should check local requirements based on where their rental property is located.
