Including HST in pricing

[Becky0]

Hi,

I'm wondering is any fellow Ontario/Canadian hosts have advice about adding HST to your prices in a way that doesn't either leave you out of pocket for having to give away 13% of the fair rate for your listing, or put off potential guests for seeming to be a sneaky added fee.

Air BnB suggests that, if you have to charge tax on your listing, you can do so by confirming all booking via special offer that breaks down the base and tax portions, but I'm curious to know if anybosy has any experience with doing this and what wording you've used (did you include it on your listing, for example, or wait until you received a booking request to broach it?)

I am self-employed and HST registered, hence the question. I know there will be many Air BnB hosts for whom collecting HST doesn't apply, but some of you must be doing it!

I know that stays of one month or more are exempt from HST.

Looking forward to hearing what other hosts have found successful,

Becky

[Sadie14]

Do you know what the qualifications are? Currently I rent out the spare room in my apartment and I am not charging anything extra for taxes. I was hoping this would count as subsidizing my rent when it came to tax company? Any help is appreciated. 

[Janine3]

Qualifications?  For what?

[Robert916]

I've read through all these posts...it is apparent that there is no real solution yet to the HST...or GST plus provincial sales taxes.  The rules of when you have to collect are reasonably clear...thanks to the HR Block article and CRA's material...basically if you have short term rental income over 30 thousand in a year, or are otherwise registered for GST/HST and have to remit sales taxes anyway.  But not clear to me is on what.  My take is that it would be on the net that I get from Airbnb.  I'm not about to collect HST on any portion that Airbnb takes from me or from the guest...that is their income. So it must be on the amount I get. Not sure if it should include the cleaning fee...but probably, since that is a "service".   I'm anticipating hitting the 30 thousand in the next year or so...and my plan is to invoice the guests seperately...and include my HST number which I believe is required.  However my invoice will be on a number (my "income" from Airbnb) which will not correspond to the numbers that the guest sees.  They see their gross cost, which includes the Airbnb guest fee and the service fee charged to the host...in other words a larger number.  Not sure that this is a problem...but I hate to confuse guests.  The tax (in my case 13% in Ontario) is on my portion.  I can figure that out...but it is a pain to have to do it and collect it and invoice it... but in my opinion better than the option of just hiding it in a higher booking cost...and having my unit look less attractive.

Anyway...when the time comes I'll do it...but not looking forward to it.  And a shout out to Airbnb...at the 30 thousand level per any 12 month period this kicks in...for the whole country. Not just a city...a whole country. Either GST plus provincial sales tax...or HST.  And provinces without HST have somewhat differnt rules as I understand...another twist.

[Vikas22]

The bigger issue for me is that when you register your airbnb for HST once you hit 30k it is now considered a commercial property.  The problem arises when you sell your unit.   You now must pay 13% tax on your sale since you are selling a commercial property as opposed to a residential one.  Unfortunately, due to this I will be switching my airbnb from a short term rental to a monthly rental once I get to 30k.  This is what my accountant has explained to me.   

[Aubrae-and-Peter0]

Does any one know if HST applies solely to nightly rates, or is this also applicable to cleaning fees as well? 

[Janine3]

I would suggest consulting with an accounting/tax professional and/or the CRA website.  But I'd be very surprised if there was an HST exemption on clearning services.  

[Stephan2406]

Unfortunately it pertains to cleaning fees as well as it is a "service" rendered.