Short-Term Rental Regulations in Toronto (2026 Guide)
Short-term rentals (STRs) are a growing business in which homeowners rent out their homes or rooms for a short duration. STR’s business owners promote their listings on platforms such as Airbnb, Vrbo, and others to attract visitors looking to book short stays. Since Toronto receives many visitors each year, it has been a market-demand business to this day.
The City of Toronto introduced short-term rental laws to effectively implement and manage short-term rentals and to strike a balance between property rights and community needs.
The regulations are also established to address concerns about housing availability, noise complaints, and fair taxation in Toronto.
So, if you are property owners, renters, investors, or anyone interested in offering or staying in a short-term rental in Toronto, this is a guide for you! At the end of the guide, you’ll know more about the rules, registration steps, enforcement and penalties, the impact on hosts and real estate investors, and how to stay compliant and successful.
Definition of Short-Term Rentals in Toronto
The City of Toronto defines short-term rentals as stays of 28 days or less. Short-term rental laws in Toronto are different from long-term rentals. The stay duration for a long-term rental is 28 days or more, while short-term rentals are 28 days or less. Compared to STRs that promote listings on platforms such as Airbnb or Vrbo, long-term rentals are usually advertised through local classifieds, real estate agents, or rental websites.
Key Rules & Regulations For Short-Term Rentals in Toronto (Updated 2026)
Here are the key rules and regulations for short-term rental laws in Toronto that you must know:
- Primary Residence Rule
You can only rent out your principal residence. Only one principal residence is allowed at one time, so you cannot legally operate more than one short-term rental.
- Night Limits
You can rent the entire home for a maximum of 180 nights per year or unlimited nights per year for up to three bedrooms in your principal residence. Your property must be in a residential area in Toronto, and you can host a short-term rental in a secondary suite or laneway suite if the suite is your principal residence.
There is no limit on the number of nights if you are present during the rental duration.
- Registration Requirements
As part of the short-term rental laws, Toronto hosts must register with the City of Toronto. Hosts must comply with the annual registration fee of $375 (subject to annual increase). Additional verification may be required, including providing documents to prove your principal residence.
- Displaying Registration Number
You must display your registration number on all your listings.
- Taxes & Fees
Hosts must pay a Municipal Accommodation Tax (MAT), which is currently 8.5% (subject to change), and is typically collected by platforms.
- Enforcement & Compliance
The City of Toronto has increased enforcement on short-term rentals. Hosts may be subject to property inspections and must comply with safety requirements, including providing emergency information inside the property. Platforms such as Airbnb may remove listings that do not have a valid registration number, and non-compliance may result in fines.
What Changed in 2025–2026 for Short-Term Rentals in Toronto
- Increased Municipal Accommodation Tax (MAT)
The Municipal Accommodation Tax (MAT) has been temporarily increased from 6% to 8.5% as of June 2025, and is expected to remain in place until July 2026 (subject to change).
- Stricter Enforcement & Compliance
- The City of Toronto has significantly increased enforcement efforts to identify and remove non-compliant listings.
- Recent changes include:
- Stronger principal residence verification requirements
- Potential property inspections to confirm compliance
- Increased collaboration with platforms like Airbnb to monitor listings
- Higher Penalties for Non-Compliance
- Fines of up to $50,000 for individuals and $100,000 for corporations
- Removal of listings from platforms such as Airbnb
- Possible suspension or revocation of registration
Toronto Short-Term Rental Registration Process (Step-by-Step)
- Step-by-step process:
- Eligibility check: You must provide at least two pieces of documentation and your government-issued identification as additional evidence of your principal residence.
- Gather the required documents, such as an Ontario driver’s license or Ontario photo card.
- Register your short-term rental via the City of Toronto portal.
- Timeline and approval process: The approval application process may exceed 90 days, depending on the volume of applications.
Bonus tips to ensure smooth registration: Before registering, ensure you are a registered operator and have provided a valid city-issued registration number on all your advertised listings.
Fines & Penalties for Non-Compliance
- The City of Toronto can revoke your short-term rental registration if you violate the bylaw.
- If you continue to violate the bylaw, you may have to pay a fine of up to $100,000 or a daily fine of up to $10,000.
- The city may inspect or audit your listing at any time.
- Residents can report complaints to 311 for the City to investigate these claims by investigating, educating, and/or taking enforcement actions.
Impact on Hosts & Real Estate Investors
- Opportunities: Hosts and real estate investors can earn legal income as the tourism demand increases each year.
- Challenges: The short-term rental laws in Toronto can reduce potential earnings, and the compliance requirements can add administrative burdens to hosts.
- Investment considerations: Investors must carefully consider the short-term rental laws in Toronto when evaluating properties for potential rental income.
How to Stay Compliant with Toronto Short-Term Rental Regulations
- Stay transparent: Keep detailed records of rental nights and income to ensure compliance with regulations.
- Work smart: Use platforms that collect MAT automatically.
- Be alert: Stay informed on updates to bylaws.
How to Comply With the Short-Term Rentals Regulation in Toronto
Toronto’s short-term rental laws require an understanding of the primary residence rule, night limits, and registration requirements. Hosts can benefit from the demand for short-term rentals by operating responsibly and legally while contributing to the city’s housing stability.
Visit the official registration portal of the City of Toronto for the latest updates on short-term rentals in Toronto. Need trusted property management for short-term rentals in Toronto? Contact a short-term rental management company today. We’ll guide you from A to Z until you can operate your dream Airbnb business.
