Short-term rentals powered by platforms like Airbnb have emerged as popular alternatives to traditional hotels. For a city as dynamic and sought-after as Toronto, this has implications for hosts, guests, and long-term residents. As such, Toronto has established regulations to balance economic opportunities with community well-being.
The City of Toronto Chapter 547 regulates short-term rentals in Toronto.
What is a Short-Term Rental Operator/Host?
Short-term rental operators are people renting their homes or rooms on a short-term basis for a period of less than 28 consecutive days.
Mandatory Registration and Annual Renewal
Every short-term rental in Toronto must be registered. Potential guests are advised to look for a City-issued registration number (format: STR-0000-XXXXXX) in listings or advertisements. Short-term rentals without this number should be avoided.
To short-term rent, you must be:
- 18 years or older
- using your principal residence in Toronto
- able to demonstrate that you live at your principal residence
The registration shall be renewed every year. To renew your short-term rental registration, you will need:
- Your short-term rental registration number
- The government-issued identification you used to register, either your Ontario Driver’s Licence or Ontario Photo Card
- A valid credit card to pay the annual renewal fee
Annual Rental Cap
Chapter 547 limits how frequently a property can be rented to 180 nights per year.
Principal Residence Requirement
Short-term rentals are limited to one’s principal residence, ensuring properties aren’t bought solely for transient use. This residence is identified through bills, identification, and other official documents.
Property Eligibility
Condominiums or apartment buildings might have their own regulations or restrictions related to short-term rentals. Always consult with the property management or condominium board.
Non-Discrimination
Operators cannot discriminate based on race, ethnicity, citizenship, sex, sexual orientation, gender identity, age, marital status, family status, or disability. Additionally, people with service animals must be accommodated.
Municipal Accommodation Tax (MAT)
As a registered short-term rental operator, you must collect and remit a six percent (6%) Municipal Accommodation Tax (MAT) on all rentals. The payment is due every quarter within 30 days of the end of the quarter, according to the following schedule:
| Reporting Period | Due Date |
|---|---|
| January 1 to March 31 | April 30 |
| April 1 to June 30 | July 30 |
| July 1 to September 30 | October 30 |
| October 1 to December 31 | January 30 |
Safety and Accessibility
Hosts must provide guests with clear exit diagrams of the property. This ensures guests can evacuate safely during emergencies, aligning with Ontario’s Fire Protection and Prevention Act, 1997.
Neighborhood Harmony
Short-term rentals come with responsibilities. This includes adhering to noise regulations, parking rules, and proper waste disposal. Guests should inquire about these to ensure they are good neighbours during their stay. For additional information, refer to Good Operator Guide.
Fines and Penalties
Short-term rental operators are guilty of an offence if they do not comply with the bylaw. If they are issued a ticket and convicted, they may have to pay a fine for the offence set out in the bylaw.
If operators are issued a summons to court and convicted, they may have to pay a fine of up to $100,000 or a daily fine of up to $10,000 each day the violation continues. In addition, they may have to pay a special fine for economic gains from the bylaw violation. If it is a corporation, every director or officer may have to pay a fine of no more than $100,000.
Summary
Short-term rentals provide a distinctive way to explore Toronto, benefiting tourists seeking authentic experiences and hosts looking to earn extra income. However, navigating this option requires awareness, preparation, and a sincere commitment to offering memorable stays. As the city continues to thrive as a top travel destination, understanding these essential considerations is crucial to ensure that the spirit of Toronto remains lively and welcoming.
If you plan to buy a property in Toronto for short-term rental, it is essential to seek legal advice to ensure that you know all the current rules and regulations. A Toronto real estate lawyer can guide and advise you before you make a purchase decision and help you understand the legal implications of short-term rental.
The information provided above is of a general nature and should not be considered legal advice. Every transaction or circumstance is unique, and obtaining specific legal advice is necessary to address your particular requirements. Therefore, if you have any legal questions, it is recommended that you consult with a lawyer.
