Tax Tips-ONTARIO STAYCATION TAX CREDIT for 2022
For the year 2022, if you are an Ontario resident and you stayed at a hotel or similar accommodation located in Ontario, you could get up to $200 of your accommodation expenses as an individual or up to $400 as a family in the form of a refundable tax credit on your 2022 tax return filing next year. This temporary credit aims to encourage Ontario families to explore the province and at the same time help the tourism and hospitality sectors recover from the financial impacts of the pandemic. Here are the various conditions and eligibility requirements:
1. You have to be an Ontario resident on December 31, 2021.
2. The accommodation expenses must be for short term leisure stay of less than 1 month. Accommodation expenses for business, school, employment, medical, long term stays all do not qualify for this credit.
3. The accommodation must be located in Ontario.
4. The accommodation includes a hotel, motel, resort, lodge, bed & breakfast, cottage, campground, or vacation rental property.
5. The accommodation provider must be registered for the GST/HST. Otherwise, the accommodation will not qualify. So, it is important to check as some vacation rental property and AirBNB may not be GST/HST registered and therefore, will not qualify.
6. The tax credit is calculated as 20% of the qualifying accommodation expense. For an individual, the maximum qualifying accommodation expense is $1,000 (max 20% tax credit of $200) and for a family, the maximum qualifying accommodation expense is $2,000 (max 20% tax credit of $400).
7. The accommodation expense can be a single trip stay or can be multiple trip stays added up.
8. The stay periods must be within 2022 to qualify. It does not matter if payment is made in another year. If payment is made in 2022 but the stay period is in 2021 or 2023, it will not qualify.
9. Supporting documents are required for the claim. Receipts should have the following info:
- location of the accommodation (must be in Ontario)
- amount for the accommodation
- GST/HST number of the accommodation provider (must be GST/HST registered)
- amount of GST/HST charged
- period of stay (must be within 2022)
- name of the payor
If you would like to learn more or to set up a consultation call Marlies Y Hendricks, CPA at 416-766-3941.
The above information is of a general nature only and should not be relied upon for specific situations.