Toronto Airbnb License

How To Obtain A Short-Term Rental License In Toronto

Heads up, ambitious Airbnb hosts! Before you start planning on aesthetic decorations and coming up with the best ways to make your guests feel at home, you must educate yourself on the regulations surrounding short-term rentals in Toronto. 

Every Airbnb host in Toronto must register and obtain a registration from the City of Toronto that allows you to operate a short-term rental in your property. Before we start on the steps to applying for a short-term rental license in Toronto, here is a summary of Toronto’s short-term rental regulations. 

Toronto’s Short-Term Rental Regulations

  • Principal Residence Requirement: Short-term rental licenses Toronto are only allowed in a principal residence, not investment properties. The property address must be where the host lives and appears on official documentation such as bills, taxes, and identification.
  • Registration and Fees: The Host must register with the City of Toronto and pay a $375 annual registration fee. 
  • Rental Limits: Entire homes can be rented on a short-term basis for a maximum of 180 nights per year. Hosts can rent out up to three bedrooms or their entire residence. If renting out by room, there is no limit on the number of nights.
  • Taxes: A 6% Municipal Accommodation Tax (MAT) applies to rentals with a duration of fewer than 28 nights.
  • Eligibility for Tenants: Tenants and residents of secondary suites or laneway houses can only rent short-term if it is their principal residence.

Learn more about Short-Term Rental Operators/Hosts and Short-Term Rentals in Toronto. 

Steps To Applying For A Short-Term Rental License in Toronto

There are six steps that you need to follow to obtain a short-term rental license in Toronto. 

Step 1: Check Eligibility

  • Principal Residence: The property must be your principal residence.
  • Age Requirements: You must be at least 18 years old to apply.
  • Condo Board Regulations: Ensure compliance with condo board regulations (if applicable).

Step 2: Register for a Short-Term Rental License

  • Access the City’s Portal: Visit the City of Toronto’s licensing portal: https://secure.toronto.ca/webapps/short-term-rental/registration/
  • Required Documentation:
    • Ontario Driver’s License or Ontario Photo Card
    • Emergency contact information
    • Be prepared to provide proof of principal residence:
      • Phone/Internet/TV Bill
      • Utility Bill
      • Bank Statements
      • Credit Card Statements
      • Home Insurance Bill
      • Vehicle Registration

Step 3: Pay the Registration Fee

  • Annual Fee: The annual registration fee is $375 (subject to change). Payment is made online through the city’s licensing portal.

Step 4: Collect and Remit the Municipal Accommodation Tax (MAT)

  • Tax Rate: A 6% Municipal Accommodation Tax (MAT) applies to short-term rentals in Toronto.
  • Remittance: Hosts must collect and remit this tax to the city quarterly unless using a platform such as Airbnb that handles remittance on their behalf.

Step 5: Comply with Operational Requirements

  • Display the Registration Number: Display your STR registration number on all listings.
  • Guest Information: Provide guests with emergency contact information and safety instructions.
  • Safety Regulations: Follow fire and building safety regulations.

Step 6: Renew Annually

  • Annual Renewal: To remain active, the short-term rental license must be renewed annually.

Consequences Of Operating a Short-Term Rental without a valid registration

Here are some of the consequences of operating short-term rentals without a valid registration in Toronto: 

  • Listing Removal: Airbnb platforms such as Airbnb and Booking.com may deactivate your listing if you fail to display a valid registration number, impacting your ability to operate.
  • Cancellation of future bookings: future reservations will be cancelled if your license is revoked or expires. 
  • Registration Revocation: As of June 30, 2024, the revocation process has been streamlined to a 10-day timeline, allowing quicker enforcement.

We recommend avoiding the headache and abiding by the short-term rental regulations in Toronto.  These regulations are implemented to preserve housing for Toronto’s residents and protect the community. 

Why Is A Short-Term Rental License In Toronto Compulsory?

The short-term rental license in Toronto is necessary for these key reasons:

  • Housing Preservation: The city aims to prevent investment properties from being used as short-term rentals, which can reduce the availability of housing for local residents. 
  • Regulation and Compliance: Licensing ensures that operators comply with specific regulations, such as the Municipal Accommodation Tax (MAT), which helps fund city services to ensure that properties meet safety standards, reducing risks for guests and neighbours.
  • Community Protection: Licensing helps manage noise, waste, and other neighbourhood disturbances. Residents can report concerns about non-compliant rentals to help maintain community quality.
  • Revenue Generation: The Municipal Accommodation Tax collected from short-term rentals contributes to the city’s revenue, services, and supporting local infrastructure.
  • Accountability: With a legal short-term rental license Toronto, the city can track and enforce compliance with regulations, including limits on the number of nights a property can be rented short-term. This accountability helps maintain a balance between short-term rentals and long-term housing needs.

All in all, the licensing system is designed to allow short-term rentals in Toronto and contribute to a fair and well-regulated rental market while minimizing the negative impacts on the community.

Get Your Short-Term Rental License In Toronto Sorted

Understanding the short-term rental license in Toronto can be challenging, but following these steps will help you comply with the city’s requirements. Acquiring a short-term rental registration the right way will help you operate your dream Airbnb with peace of mind. 

Need a professional hand to assist with your short-term rental license in Toronto? Contact Maxima Properties, a premier, locally-based property management company for short-term rentals in Toronto.

Start your Airbnb business with us today!