Cleaning fee & VAT

[Bo126]

Hi, I'm new to Airbnb and currently in Toronto. I have two questions, and I would appreciate any help you can provide.

1. How can I add the cleaning fee to the invoice for the guest? Airbnb provides me with a breakdown of my potential earnings, but it doesn't include the cleaning fee.

2. How should I pay VAT to the Toronto government? Do I need to calculate it myself and submit it quarterly on Toronto.ca website?

[Bo126]

I now know how to add the cleaning fee. Still need help with the VAT. Thank you everyone.

[Alicia753 · Accepted solution]

Hi @Bo126,

Welcome to the community!

As a new Airbnb host in Toronto, understanding how to handle VAT, known as the Municipal Accommodation Tax (MAT) in Toronto, is crucial. For Toronto-based listings, Airbnb directly collects and remits a 6% MAT on the listing price, including cleaning fees, for applicable reservations. This process is automated, so you don't need to calculate or submit this tax yourself for those bookings. It's part of Airbnb's efforts to comply with local tax laws and regulations, ensuring a smoother process for hosts and guests alike​ (https://www.airbnb.ca/help/article/2283)

For a any other tax obligations, including whether your Airbnb operations classify as a business and the implications thereof, it may be beneficial to consult with a tax professional or refer to resources provided by organizations like H&R Block or BDO Canada​. This will help you navigate the complexities of tax collection and remittance, ensuring compliance with Canadian tax laws.

H&R Block - https://www.hrblock.ca/media/2021-Airbnb-Reporting-Guide-EN.pdf#:~:text=URL%3A%20https%3A%2F%2Fwww.h...

BDO Canada - https://www.bdo.ca/insights/tax-considerations-airbnb-hosts

Hope this helps!

[Bo126]

Thank you. I miss you for your response. I now understand MAT is the Toronto VAT.  I know it's 6%, but I cannot find it from the breakdown of either  "Guest paid" or "Host payout".  The only tax on "Guest paid" is the Occupancy tax.  I have no idea what it is.  If you can help to provide some clue, I will  appreciate it.