Planning or having already taken an Ontario staycation in 2022, Ontario’s Staycation Tax Credit could save you money.
Ontario residents who book a trip anywhere in the province in 2022 are eligible to claim a portion of qualified accommodation expenses thanks to the new, temporary Ontario Staycation Tax Credit.
Planning on Taking a Vacation
Ontario residents who take a vacation between January 1 and December 31, 2022, can claim 20% of their eligible 2022 accommodation expenses, for example, for a stay at a hotel, cottage or campground, when filing their personal Income Tax and Benefit Return for 2022. In addition, you can claim eligible expenses of up to $1,000 as an individual or $2,000 if you have a spouse, common-law partner or eligible children to get back up to $200 as an individual or $400 as a family.
The credit will provide an estimated $270 million in support to about 1.85 million Ontario families.
You are eligible to claim the credit if you are an Ontario resident on December 31, 2022.
Only one individual per family can claim the credit for the year. Your claim can include the eligible expenses of your spouse or common-law partner and your eligible children. An eligible child is not entitled to claim the credit.
You can claim your qualified expenses for the credit if you do not have a spouse, common-law partner, or eligible child.
What costs qualify for the Ontario Staycation Tax Credit?
You can claim the Ontario Staycation Tax Credit for accommodation expenses for a leisure stay of less than a month in Ontario, at a short-term accommodation or camping accommodation, such as a:
- hotel
- motel
- resort
- lodge
- bed-and-breakfast establishment
- cottage
- campground
- vacation rental property
- Airbnb provided the host is registered for GST/HST, and the accommodation fits all other criteria.
The tax credit only applies to leisure stays between January 1, 2022, and December 31, 2022, regardless of the timing of payment for the stays.
You, your spouse (or common-law partner), or your eligible child must have paid the accommodation expenses.
As long as all other conditions are met, you can claim any of the following expenses:
- accommodation for a single trip or multiple trips, up to the maximum expense limit of $1,000 as an individual or $2,000 as a family
- accommodations booked either directly with the accommodation provider or through an online accommodation platform
- the portion of the expense that is necessary to have access to the accommodation
- the accommodation portion of a tour package expense
You must keep your detailed receipts for any eligible expenses you claim for the credit. Those receipts must include:
- the location of the accommodation
- the amount that can reasonably be for the accommodation portion of a stay
- the amount of any GST/HST paid
- the date of the stay
- the name of the payor
What costs do not qualify for the Ontario Staycation Tax Credit?
Short-term accommodation would generally not include a timeshare agreement or a stay on a boat, train or other vehicles that can be self-propelled.
The Ontario Staycation Tax Credit cannot be claimed for:
- travel expenses that are not for short-term accommodation or camping accommodation, such as expenses for car rentals, fuel, flights, groceries, parking, or prices of admission into local attractions and places of interest
- accommodation expenses reimbursed to you, your spouse or common-law partner, or your eligible child, by any person, including by a friend or an employer
- expenses that are incurred for school or educational purposes, or for work, employment or business purpose or that can be claimed for a medical expense tax credit
How do you claim the Ontario Staycation Tax Credit credit?
You can claim the credit on your personal Income Tax and Benefit Return for 2022.
The Ontario Staycation Tax Credit is a refundable personal income tax credit. If you are eligible, you can get this tax credit regardless of whether you owe income tax for 2022.
Contact McCay Duff LLP in Ottawa for Efficient Tax Solutions
At McCay Duff LLP, our trusted tax experts can help you determine which deductions and tax credits are available to you and your business. In addition, our experienced accountants provide comprehensive tax planning and preparation solutions to help our clients in Ottawa and across Ontario. To learn more about how we can help you and your business, contact us online or by telephone at 613-236-2367