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As of October 1, 2018, if you own a rental property in B.C. that is currently rented out on a short-term basis (less than one month at a time) you are now required to collect and remit additional taxes on the fees you charge your customers.

Unless certain exemptions apply (see below), all short-term rentals will be subject to:

  • Provincial Sales Tax (PST) at a rate of 8% on the fee charged, as well as
  • Municipal and Regional District Tax (MRDT) at a rate of up to 3%

You will be required to charge the additional 8% PST and 3% MRDT to your customers, collect the taxes, register with the Provincial government, file a PST Return and a MRDT return each year, and pay the taxes owing.

Filing your PST and MRDT returns

The easiest way to file both your PST and MRDT returns is to register with the government through eTaxBC. After registering through eTaxBC you will be able to file your PST and MRDT returns electronically.

If you prefer not to register with eTaxBC and instead manually paper-file your tax returns, you can download the PST return (form FIN400), or MRDT return (form FIN 401),

Payments can be made in several ways: via eTaxBC, through your online banking, mailed to the PST Department, or made in person at your nearest Service BC Centre.

Exemptions

You will not be required to collect PST or MRDT if you qualify for one of the exemptions below:

  • Your total rental income is expected to be less than $2,500 for the year, and you do not list your rental on an online accommodation platform (such as AirBnB or VRBO)
  • You charge less than $30 per day, or $210 per week
  • You rent the property out to the same person for a continuous period of more than 27 days
  • For more specific exemptions see the Province’s PST on Accommodation Guide

If you require any assistance with accounting for the taxes on your short-term rental, or filing your PST and MRDT returns, please don’t hesitate to contact us.

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Braam de Klerk

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The information contained in this article is for general use only and should not be viewed as professional advice. Accounting and tax rules and regulations regularly change and individuals should contact a competent professional to obtain accounting and tax advice based on their specific situation.

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