Step 4 – Collect and Report the GST and QST – Short-Term Accommodations
Collecting the taxes
If you are a registrant, you must collect GST and QST on your taxable supplies.
Calculating the taxes
GST and QST must be calculated on the total taxable supplies, including:
- the price of an overnight stay;
- the tax on lodging;
- the price of any included goods and services.
You can claim an input tax credit (ITC) and input tax refund (ITR) for some expenses incurred to rent out an accommodation unit.
If you make purchases from some suppliers outside Québec or some digital platform operators that are on the list of suppliers outside Québec registered for the QST and have a registration number beginning with “NR,” you must give them your QST registration number to avoid paying the tax.
If you do not, you will be billed the QST for transactions involving a good or service supplied in Québec. To claim a QST refund, you will have to contact the supplier outside Québec or the digital platform operator within two years of the date you paid or were billed the QST.
Reporting the taxes
If you are a registrant, you must file a GST and QST return for each reporting period, even if you have no tax to remit or you are not entitled to a refund. Since Revenu Québec administers the GST and QST, you can file a single GST and QST return.
You can name an agent to collect, report and remit the GST and QST for you by completing form FP-2506-V, Election or Revocation of an Election by a Principal and the Principal's Agent: Responsibility for Collecting, Reporting and Remitting the GST/HST and the QST.
You can only make this choice for the GST and QST and not for ITCs and ITRs.
Co-owned accommodation unit
If you buy a condo to rent out accommodation units, you can also name an agent to collect, report and remit the GST and QST for all co-owners by completing form FP-2506-V.
The co-owners can also agree in writing to have an agent collect and remit the tax on lodging.
Paul and Francine bought a property together that they want to use for short-term rentals. They are both registered for the GST and QST and have no other business income. They advertise their property on social media and are asked to provide information about one of the co-owners. Together they complete form FP-2506-V and name Paul as the agent for collecting, reporting and remitting the GST and QST. Since their choice only applies to the GST and QST, they must each register for and remit the tax on lodging.
They then begin renting out their property. The table below lists their rental expenses and income, the taxes they have to remit and the ITCs and ITRs they can claim for the first quarter of 2023.
|
Rental income |
$15,000 |
|---|---|
|
Operating expenses |
$3,000 |
|
Tax on lodging |
$525 |
|
ITC |
$150 |
|
ITR |
$299.25 |
|
GST |
$776.25 |
|
QST |
$1,548.61 |
For the first quarter of 2023, each co-owner must report $262.50 in their lodging tax return (form VDZ-541.26-V), which is 50% of the total tax to remit. For the GST and QST payable, Paul and Francine must enter the amounts below in their respective GST and QST returns.
|
Amounts to report |
Paul |
Francine |
|---|---|---|
|
Total supplies (rental income) |
$15,000 |
$0 |
|
GST/HST payable |
$776.25 |
$0 |
|
ITC |
$75 |
$75 |
|
GST payable or refund |
$701.25 |
- $75 |
|
QST payable |
$1,548.61 |
$0 |
|
ITR |
$149.63 |
$149.63 |
|
QST payable or refund |
$1,398.98 |
- $149.63 |