Personal Finance

Airbnb - Tax and Expense question

  • Last Updated:
  • Jan 4th, 2020 12:59 pm
[OP]
Deal Addict
Dec 23, 2005
2151 posts
343 upvotes
Canada

Airbnb - Tax and Expense question

So I just started up an AIRBNB at a ski resort condo I own. Had my 1st renters Dec 29th. I used it only has personal use up to that point but going to make it avail to airbnb for all of 2020. I am going to go see an accountant but curious if anyone here knows the answer to this. I spent a lot of cash to get it ready to rent in 2019. Can I claim what I spent to get it ready in 2019 even if I did not make revenue in 2019. The money I spent was to get it ready to rent in 2020 accept for the few days at the end of Dec. I did not get paid for that from airbnb until Jan as the period was Dec 29 to Jan 3rd.
4 replies
Deal Addict
Nov 13, 2006
1159 posts
790 upvotes
Yes you can. This will fall under your T2125 in your 2019 tax return. Since you are claiming a loss with no income there is a 100% chance you will get reviewed by the CRA in late 2020. So make sure you keep all receipts/invoices and only claim for the documents you can get the backup for.
Deal Addict
Jul 29, 2006
4142 posts
971 upvotes
Think you'll need to pro-rate the nightly amount of what falls into 2019 vs 2020.

Yes you can but depending on how much you spent to get it ready, are you willing to risk getting audited?

Also, keep in mind if you think you'll do really well with this Airbnb (>$30k/year), then you'll need to register for an HST account and also in the future if you ever decide to sell this property, it'll be seen as a commercial property and hence get taxed even further unless you do some creative corporate structure (see a specialized real estate accountant for this).
Member
Jul 29, 2007
280 posts
180 upvotes
Markham
Depending on what you spent on, some things may be considered capital and you'd have to claim CCA instead of writing it off as an expense immediately.
Deal Addict
User avatar
Dec 24, 2007
1513 posts
1778 upvotes
BC
goo421 wrote: Depending on what you spent on, some things may be considered capital and you'd have to claim CCA instead of writing it off as an expense immediately.
Ditto....what did you do to "get it ready" and what is your official business start date? Startup costs that may be claimed..

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