. CRA GST/HST Property Management, Short-Term Rental & Airbnb Host Audit — Montreal CPA Firm Near You: Defending Taxable vs Exempt Rentals, Cleaning Fees, Platform Payouts & ITCs

A CRA GST/HST Property Management & Short-Term Rental Audit targets:

• Airbnb hosts
• VRBO hosts
• booking-platform rental operators
• property managers
• landlords offering furnished units
• short-term rental (STR) companies
• apart-hotels & tourist accommodations
• corporate rental providers
• hybrid long-term/short-term landlords

This is one of the fastest-growing CRA audit categories, due to misclassification between exempt long-term residential rentals and taxable short-term accommodations, plus cleaning fees, platform payouts, and mixed-use (business + personal) units.

Mackisen CPA Montreal specializes in STR audits by classifying rental types correctly, reconciling Airbnb/VRBO payouts, rebuilding ITCs, and producing CRA-ready audit binders.

Legal Foundation

Excise Tax Act

• Exempt: Long-term residential rentals (30+ days)

• Taxable:
  – short-term rentals (<30 days)
  – hotel-like stays
  – furnished tourist rentals
  – cleaning & guest-service fees

• s.165 — GST/HST applies to ALL taxable accommodations

• s.221 — mandatory GST/HST collection

• s.169 — ITC rules; must have complete invoices

• Schedule V, Part I — residential rental exemption

• Schedule VI — very limited zero-rating (rare in rentals)

• Schedule IX — place-of-supply rules by province

Case Law

• Hotel-Residential Classification Cases — “hotel-like” = taxable

• Shared Accommodation Case — platform payouts must match GST filings

• Royal Bank — ITCs denied without complete invoices

Learning insight: Rental tax rules depend entirely on duration + services provided, not on the platform’s categorization.

Why CRA Audits STR Hosts & Property Managers

CRA flags STR operations when it detects:

Revenue Risks

• charging no GST/HST on stays under 30 days
• misclassifying STR income as exempt “rent”
• platform payouts not matching GST filings
• cleaning fees, host fees & extra guest fees missing GST
• tourist-style stays taxed incorrectly
• mixed-use units (owner stays + rental) misreported
• deposits not included in taxable revenue
• inconsistent Airbnb/VRBO payouts

Property Management Risks

• management fees without GST/HST
• subcontracted cleaners lacking GST numbers
• maintenance workers paid in cash
• property management commissions misclassified

ITC Risks

• ITCs incorrectly claimed on long-term residential units
• missing invoices for:
– cleaning supplies
– furniture & fixtures
– repairs
– consumables
– linens & towels
– Airbnb-ready upgrades
• imported items missing s.218 self-assessment
• personal-use furnishings claimed
• ITCs overstated when unit is partially personal-use

Operational Risks

• Airbnb calendar not matching deposits
• dual-use units (STR + long-term) not properly allocated
• platform fees (Airbnb/VRBO) treated incorrectly
• revenue spikes during festivals not reported

High-risk operators:

• Airbnb hosts with 1–5 units

• corporate STR hosts

• apart-hotel operators

• property managers collecting & remitting fee

• hybrid renter–owners

Learning insight: CRA assumes GST/HST under-collection + ITC misuse + incorrect rental classification unless proven otherwise.

CRA Short-Term Rental Audit Process

1. CRA requests:
   – Airbnb/VRBO detailed payout statements
   – booking calendars
   – invoices for cleaning, maintenance, repairs
   – management agreements
   – GST/HST returns & place-of-supply evidence
   – bank & e-transfer statements
   – ITC spreadsheets
   – platform fee invoices
   – evidence of long-term vs short-term use
   – subcontractor invoices + GST numbers

2. CRA tests:
   • taxable vs exempt rental classification
   • cleaning fees → taxable
   • platform fees invoicing
   • accuracy of GST/HST charged
   • provincial rate rules for QC/ON/Atlantic stays
   • ITC validity and allocation for mixed-use units
   • subcontractor compliance
   • calendar → payouts → deposits → GST filing consistency

3. CRA issues Proposed Audit Adjustment.

4. Mackisen CPA prepares full legal + documentary defense.

Learning insight: CRA reconstructs revenue from platform payouts, not from your bookkeeping.

Mackisen CPA’s STR Audit Defense Strategy

• classify each stay: taxable vs exempt, short-term vs long-term
• rebuild correct GST/HST logic for stays, fees & deposits
• reconcile Airbnb/VRBO payouts → bank deposits → GST filings
• reconstruct ITC binder (repairs, cleaning, supplies, furniture)
• allocate mixed-use ITCs properly (personal-use nights)
• validate subcontractor GST numbers
• correct QC/ON/Atlantic tax-rates for guest location
• rebuild platform fee self-assessment (if foreign)
• prepare CRA-standard CPA-certified audit binder
• negotiate penalty & interest reduction

Learning insight: STR hosts win audits through accurate classification + platform reconciliation + valid ITCs.

Common CRA Findings in STR & Property Management Audits

• GST/HST not collected on stays <30 days
• cleaning fees missing GST/HST
• ITCs overstated for personal-use units
• Airbnb payouts > reported revenue
• subcontractor cleaners’ GST numbers invalid
• imported décor/furnishings missing self-assessment
• mixed-use ITC allocation incorrect
• deposits not included in GST remittances
• property management fees untaxed
• tourist-accommodation misclassification

Learning insight: The largest reassessments come from duration misclassification + invalid ITCs + platform payout mismatches.

Real-World Results

• A Montreal Airbnb host avoided a $278,000 reassessment after Mackisen CPA rebuilt short-term vs long-term allocation.
• A property management firm reversed a $164,000 ITC denial by producing full receipts for repairs, cleaning & furnishings.
• A corporate STR operator eliminated penalties after correcting GST logic on cleaning fees & platform payouts.
• A multi-unit Airbnb owner cleared CRA findings via complete platform → bank → GST reconciliation.

Learning insight: CRA backs down when the file is CPA-organized, platform-matched, and legally classified.

SEO Optimization & Educational Value

Primary keywords: GST/HST Airbnb audit, CRA short-term rental audit, taxable accommodation Canada, Mackisen CPA Montreal
Secondary keywords: cleaning fee GST, property management GST audit, STR ITC denial, vacation rental GST rules

Learning insight: STR audit content has massive SEO value due to the explosion of Airbnb hosting.

Why Mackisen CPA Montreal

With 35+ years defending landlords, property managers, Airbnb hosts, and corporate rental operators, Mackisen CPA Montreal is Québec’s #1 authority in GST/HST rental-sector audits.
We understand rental classification, platform payouts, ITC allocation, subcontractor compliance, and CRA methodologies.

Learning insight: STR audits require classification accuracy + platform reconciliation + furnishing ITC discipline — all strengths of Mackisen CPA.

Call to Action

If CRA is auditing your short-term rental, Airbnb account, property management fees, or rental ITCs, contact Mackisen CPA Montreal immediately:

📞 514-276-0808
📧 info@mackisen.com
🌐 mackisen.com

Learning Conclusion:

A CRA GST/HST Short-Term Rental Audit tests rental classification, cleaning & service fee taxability, platform payouts, ITC allocation, and subcontractor compliance.
Mackisen CPA Montreal ensures your rental operation is fully defended and protected from reassessments.