CRA GST/HST Airbnb & Short-Term Rental Audit — Montreal CPA Firm Near You: Defending Taxable vs Exempt Use, ITCs, and Change-of-Use Rules

A CRA GST/HST Airbnb & Short-Term Rental Audit examines whether your property — home, condo, duplex, triplex, cottage, or investment unit — was correctly reported for GST/HST purposes when used for Airbnb, VRBO, Booking.com, or any platform offering short-term stays (less than 30 days).

Short-term rentals are taxable, unlike long-term residential rentals (exempt). Because taxpayers often mix both uses, CRA aggressively audits Airbnb operators to verify:
• whether GST/HST should have been charged
• whether ITCs were claimed properly
• whether a self-assessment was required under s.191
• whether the property lost its residential complex exemption
• whether principal residence or rebate claims were invalid
• whether the taxpayer should be classified as a commercial operator

Mackisen CPA Montreal specializes in defending Airbnb audits by reconstructing usage logs, occupancy patterns, ITC eligibility, and GST/HST liability — ensuring every part of your file is defensible.

Legal Foundation

Excise Tax Act s.165 — GST/HST on taxable short-term rentals.
Excise Tax Act s.123(1) — defines “residential complex,” “short-term accommodation,” “commercial activity.”
Excise Tax Act s.191 — self-assessment required when converting a residential complex to commercial use.
Excise Tax Act s.256.2 — rental rebate eligibility rules (often denied in Airbnb cases).
Case law:
• Tarnowe — occupancy proof is critical.
• Chella — intention and actual use drive GST/HST outcome.
• HMQ v. Rankin — commercial short-term rental activity triggers GST/HST.

Learning insight: Airbnb is automatically taxable unless you prove exclusive long-term rental use — and CRA knows this.

Why CRA Audits Airbnb & Short-Term Rental Operators

CRA flags files when it detects:
• short-term rentals advertised online
• revenue reported on Airbnb/VRBO platforms
• frequent stays under 30 days
• rental rebates (NRRPR) claimed but actual use was Airbnb
• home office + Airbnb mixed-use red flags
• inconsistent utility bills or occupancy evidence
• missing GST/HST registration when revenues exceed $30,000
• mixed-use properties without proper allocation
• principal residence claims conflicting with Airbnb activity
• bank deposits from guests or platforms not matching tax returns

Learning insight: CRA assumes Airbnb = taxable business unless proven otherwise.

CRA Airbnb Audit Process

1. CRA requests:
   – Airbnb/VRBO/Booking.com occupancy logs
   – calendar of stays
   – guest receipts & payout summaries
   – bank statements
   – utility bills & insurance
   – lease agreements (if long-term rental also claimed)
   – NRRPR/NHR rebate forms
   – advertising screenshots

2. CRA determines:
   • % of nights short-term vs long-term
   • GST/HST liability on rental revenue
   • whether self-assessment s.191 should be applied
   • whether rebate eligibility is lost
   • whether ITCs were properly claimed

3. CRA issues proposed reassessment.

4. Mackisen CPA prepares a factual, timeline-based defense.

Learning insight: Airbnb audits are math + documentation + timeline audits — not opinion audits.

Mackisen CPA’s Short-Term Rental Defense Strategy

• calculate precise % of taxable vs exempt usage
• rebuild occupancy timeline using Airbnb data + communications
• defend against improper loss of residential complex status
• calculate correct GST/HST owing and eliminate CRA overreach
• defend or reconstruct rental rebate eligibility
• prepare ITC allocation schedules for renovations, cleaning, repairs, furnishings
• separate personal use, long-term rental use, and Airbnb use
• prepare CPA-certified audit binders aligned with CRA expectations
• negotiate full or partial penalty relief

Learning insight: When your usage timeline is precise, CRA’s assumptions collapse.

Common CRA Findings in Short-Term Rental Audits

• GST/HST not charged on Airbnb revenue
• NRRPR or New Housing Rebate denied
• self-assessment under s.191 not done
• ITCs denied for personal-use or exempt-use portions
• property deemed commercial → GST/HST triggered on FMV
• principal residence exemption denied
• substantial renovation treated as new construction
• Airbnb activity reclassifies entire property as taxable

Learning insight: CRA’s biggest weapon is lack of documentation — we eliminate that weakness.

Real-World Results

• A condo owner avoided a $68,000 GST reassessment after Mackisen CPA proved Airbnb was only 14% of annual use and did not trigger commercial classification.
• A triplex investor kept a $31,000 rental rebate when we isolated long-term rental activity from occasional Airbnb use.
• A homeowner reversed CRA’s builder classification after proving personal occupancy supported by hydro, insurance, and tenant-transition documentation.
• A chalet owner cleared a $92,000 s.191 reassessment through reconstructed occupancy logs and corrected GST/HST allocations.

Learning insight: Airbnb audits are won with accurate percentages and indisputable documentation.

SEO Optimization and Educational Value

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Learning insight: Short-term rental audits are among the highest-searched CRA topics — strong educational content builds trust and visibility.

Why Mackisen CPA Montreal

With 35+ years of GST/HST real-estate audit defense, Mackisen CPA Montreal is Québec’s leading authority on Airbnb and short-term rental tax rules. We understand GST/HST classification, rental rebates, mixed-use allocations, and CRA’s audit triggers — and we build airtight defense files that CRA accepts.

Learning insight: Airbnb audits are won through numbers, law, and documentation — our specialty.

Call to Action

If CRA is auditing your Airbnb, short-term rental, or rental rebate, get representation immediately.
Contact Mackisen CPA Montreal for complete audit defense and documentation reconstruction.
Phone: 514-276-0808 | Email: info@mackisen.com | Website: mackisen.com

Learning conclusion: A CRA GST/HST Airbnb Audit tests use, intention, allocation, and compliance. Mackisen CPA Montreal ensures every requirement is proven — protecting your refund, your rebate, and your real-estate tax position.