Renting out your vehicle via a digital platform such as Turo
You probably have tax obligations, since amounts received for business activities conducted through a digital platform may be considered income.
You may also be considered self-employed.
Your obligations
Generally speaking, you have to report your income from the digital economy.
If you are considered self-employed, you must include your business income in your income tax return.
You must also check whether you are required to register for the GST and QST.
For more on your obligations, click Self-Employed Persons or refer to the following:
How to report your income
Anne owns two vehicles, one of which she uses occasionally (for family outings or trips). For the current year, she decides to rent out the latter using a digital vehicle rental application. As Anne is renting out her vehicle to make a profit, she must include her rental income in the calculation of her business income.
Her total business income for renting her vehicle for the current year is $35,714. The platform deducted 30% in commission from the total income generated, which corresponds to $10,714. The platform therefore paid Anne income of $25,000 ($35,714 - $10,714 = $25,000).
Anne also incurred expenses as part of running her business. Below are the details of the invoices she kept for tax purposes for the current year.
Business expenses
| Expenses | Amount |
|---|---|
| Capital cost allowance of the vehicle according to the kilometres travelled for business | $2,0001 |
| Telecommunications expenses | $1,000 |
| Fuel costs related to travel to deliver and collect the vehicle | $1,000 |
| Travel expenses | $700 |
| Maintenance and repairs | $3,000 |
| Washing the vehicle | $1,600 |
| Registration, driver's licence and insurance premiums | $300 |
| Parking | $1,000 |
| Commission retained by the platform | $10,714 |
- The capital cost allowance is calculated according to the value, use and class of the vehicle. For more information on the capital cost allowance, see guide IN-155-V, Business and Professional Income.
Anne keeps a logbook of all trips made with her vehicle (place of departure, destination, reason for the trip and distance traveled). For the current year, the logbook shows that 6,000 km out of a total of 10,000 km are directly attributable to rental. The percentage of use of her vehicle for business is 60%.
Fin de la note
This is how Anne should complete Part 4 of form TP-80-V, Business or Professional Income and Expenses. Click on the question mark for the information you want to see..
The following table shows all of Anne's income and expenses for renting her vehicle for the current year.
Income and expenses
| Description | Line on form TP-80-V | Amount |
|---|---|---|
| Total income | 130 | $35,714 |
| Expenses | N/A | N/A |
| Management fees | 216 | $10,714 |
| Vehicle expenses (line 330) | 220 | $4,540 |
| Travel expenses | 236 | $700 |
| Multiply telecommunications expenses by the percentage of use for the business ($1,000 × 60%)1 | 238 | $600 |
| Capital cost allowance | 240 | $2,000 |
| Total expenses | 248 | $18,554 |
| Net income (or net loss) | 264 | $17,160 |
- Anne keeps a record of the number of hours worked per month, which allows her to determine that she can deduct her telecommunications expenses for business according to a usage percentage of 60%.
These examples and tables are provided for information purposes only, as income and expenses can vary depending on the business's activities and the platform used.
End of caution