Are you earning money from renting out a property in Canada? Whether you’re leasing a basement suite, an investment condo, or a vacation property on Airbnb, it’s important to understand how to report rental income to the Canada Revenue Agency (CRA). This guide is tailored for personal income taxpayers across Canada looking to stay compliant and optimize their tax return.
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🏠 What Counts as Rental Income?
According to CRA, rental income is any income you earn from allowing someone to use your property for a fee. This includes:
- Residential homes and apartments
- Secondary suites (e.g., basement apartments)
- Short-term rentals (Airbnb, Vrbo)
- Vacation cottages or cabins
- Even a single room in your primary residence
🧾 Where to Report Rental Income on Your Tax Return
Rental income must be reported on Form T776 – Statement of Real Estate Rentals. You’ll include this when filing your T1 General return. The income is added to your total taxable income for the year.
📉 What Rental Expenses Can You Deduct?
You are allowed to claim eligible rental expenses that help generate your rental income, such as:
- Mortgage interest (but not principal)
- Property taxes
- Utilities (if paid by you)
- Repairs and maintenance
- Insurance
- Advertising and legal fees
- Depreciation (Capital Cost Allowance – optional)
Tip: Keep detailed records and receipts for all expenses.
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💰 Rental Losses: Can You Claim Them?
If your rental expenses exceed your rental income, you may be able to claim a rental loss, which can reduce your taxable income. However, the CRA will scrutinize this, especially for short-term rentals or properties rented to relatives at below-market rates.
📆 2025 CRA Deadlines for Rental Income
- April 30, 2025 – Personal tax return deadline
- June 15, 2025 – For self-employed individuals (payment still due April 30)
🛑 CRA Penalties for Not Reporting Rental Income
The CRA is using advanced data-matching and even monitoring Airbnb and other platforms to find unreported income. Penalties can include:
- Fines of up to 50% of tax owed
- Interest on unpaid amounts
- Criminal charges for deliberate non-compliance
🔍 Frequently Asked Questions
Do I have to report income if I rent to family?
Yes. If you rent below fair market value, you may not be able to claim expenses or losses.
What if I only rent occasionally?
Even short-term or seasonal rentals (like summer cottages) must be reported to CRA.
Should I register for GST/HST?
If you earn more than $30,000 annually from short-term rentals, you may need to register for GST/HST and collect it from your tenants.
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✅ Key Takeaways for Landlords in Canada
- You must report all rental income to CRA
- Use Form T776 and file with your T1 General return
- Keep clear records of income and deductible expenses
- Consider working with a tax professional to avoid mistakes
Need help declaring your rental income or understanding CRA rules? Work with a qualified Canadian tax expert to make sure you’re reporting accurately and maximizing your deductions.
Disclaimer: This blog is for general informational purposes only and does not constitute legal or financial advice. For personalized tax help, consult a licensed tax advisor or accountant in Canada.
