How do you handle bookkeeping and taxes for an Airbnb in Québec?

Short answer: register with the CITQ before you rent to tourists for 31 days or less, and show your number in every listing. The 3.5% lodging tax is usually collected by the platform. GST and QST apply once your taxable sales pass $30,000, and a registered platform collects them for you if you're under that. You report the income on the T776 and TP-128 (or as business income if you offer services), and expenses for a non-compliant rental are not deductible.

Step 1: register before you list

In Québec, you need a registration to rent a bed, room, apartment, house or chalet to tourists, for pay, for stays of 31 days or less. The CITQ (Corporation de l'industrie touristique du Québec) processes registrations for general tourist accommodation and for a principal residence. You'll need a municipal document confirming the project respects zoning, proof of ownership (or the owner's or condo syndicate's authorization), liability insurance of at least $2,000,000 per event and, for a principal residence, two proofs that you live there.

The six-digit number goes in every ad, and an offer on a booking platform must also show the certificate's expiry date. Operating without registration exposes an individual to a fine of $2,500 to $25,000.

The 3.5% lodging tax

In the tourist regions where it applies, the lodging tax is generally 3.5% of the price per night. If you rent only through platforms that are registered for the lodging tax and receive the full payment (as large platforms typically do), the platform collects and remits it, and you don't need to register. If you also take direct bookings or receive part of the payment yourself, you must register and collect it on what you receive.

Example: a $150 night carries $5.25 of lodging tax.

GST and QST

You must register for GST and QST once your worldwide taxable sales, including those of associates, pass $30,000 in a single calendar quarter or over the last four quarters. Short-term rentals count toward that total, along with any other self-employed income.

Below that threshold you're a small supplier, but a registered platform still collects GST and QST on your stays. Once you're registered, you report GST and QST on your rentals even when the guest pays the platform, and you can claim back tax paid on your expenses. GST and QST are calculated on the night plus the lodging tax.

Example continued: $150 + $5.25 = $155.25, so $7.76 of GST and $15.49 of QST. More on the threshold in our small supplier article.

Rental income or business income?

If you provide only basic services (heat, light, parking, laundry), it's usually rental income: form T776 federally and TP-128 for Québec (line 136 of the TP-1). If you add services such as cleaning during stays, breakfast or guided activities, it may be business income: T2125 federally and TP-80 for Québec (line 164). On the TP-128 or TP-80, your CITQ number goes on line 59.

Expenses tied only to the rental, like listing fees, are generally fully deductible. Shared expenses are split by the period you actually tried to rent the unit and, if you rent part of your home, by the area rented.

When expenses are denied

Federally, for tax years after 2023, expenses are not deductible for a non-compliant short-term rental: a residential property rented for less than 90 consecutive days where the province or municipality doesn't allow it, or where the operator doesn't meet provincial or municipal registration, licence or permit rules. The denied share is prorated by the days of non-compliance, and a rental that became compliant by December 31, 2024 is treated as compliant for all of 2024.

Québec adopted the same idea with two differences (Finances Québec, Bulletin 2024-4): a short-term rental means a stay of 31 days or less, and only the registration rules of Québec's Tourist Accommodation Act count, not municipal bylaws. So a municipal problem can cost you federal deductions without touching the Québec ones, while a missing CITQ registration costs you both.

Bookkeeping habits that work

  • Use a separate bank account for the rental.
  • Record gross bookings, then platform fees as an expense. Payouts are net amounts and hide both.
  • Download the platform's annual earnings and tax reports in January.
  • Track nights rented and nights used personally, since they drive your expense split.

For long-term rentals, see our rental income article.

Want us to set up your rental books?

Book a free 30-minute session at soleraaccounting.ca/rendez-vous or call 450 612-7223. We'll sort out your platform reports, taxes and expenses so your rental return is ready on time. Service in French, English and Arabic.

This article is general information, not personalized accounting or tax advice.

Frequently asked questions

Do I collect the 3.5% lodging tax myself if I use Airbnb?

Generally not, if you rent only through a platform registered for the lodging tax that receives the full payment. You must register and collect it yourself on direct bookings or on any part of the payment you receive.

Do I need a GST/QST number for my short-term rental?

Only once your taxable sales pass $30,000 in a calendar quarter or over the last four quarters, counting your other self-employed income. Below that, a registered platform still collects GST and QST on your stays.

What happens to my deductions if my rental isn't registered with the CITQ?

Expenses for a non-compliant short-term rental are not deductible, federally and for Québec. Federally, the denied share is prorated by the days of non-compliance. You can also face a fine for operating without registration.

Sources

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