As we inch closer to the Victoria Day long weekend, some Ontarians will be packing their bags and heading off to a trendy motel, a bed and breaktast, or their favorite campgrounds.
A new tax credit introduced for 2022 could see people save on local stays, so don’t forget to hang onto those receipts.
Here’s how Ontario’s staycation tax credit works.
Who is eligible
The province says you must be an Ontario resident on Dec. 31, 2022 in order to be eligible.
Only one person per family can make a claim for the year, but the expenses can include those of your spouse or common-law partner, and eligible children. A child is not able to claim the credit.
If you don’t have a spouse or a common-law partner or an eligible child, you can go ahead and file for your own eligible expenses.
What are eligible expenses
Leisure stays that last less than a month in Ontario at short-term accommodation or camping locations such as:
- bed and breakfast establishment
The tax credit only applies to leisure stays between Jan. 1, 2022, and Dec. 31, 2022, regardless of when you made payments for your stay.
You, your spouse, common-law partner or eligible child must have made the payments for the accommodations, with the costs laid out in a detailed receipt by a supplier that is registered for the GST and HST.
If all other conditions are met, any of the following expenses are eligible:
- costs for stays on a single or multiple trips, up to the maximum of $1,000 in expenses either as an individual or $2,000 as a family
- stays booked either directly with the accommodation provider or through a website
- the portion of the expense that is necessary to have access to the accommodation
- the accommodation portion of a tour package expense
You’ll need to hang onto those detailed receipts in order to claim for the credit. Those receipts must include:
- the location of the accommodation
- the amount for the accommodation portion of a stay
- the amount of any GST/HST paid
- the name of the person who paid
What expenses do not qualify
Things like timeshares, time on a boat, train or another vehicle that can be “self-propelled” don’t quality as short-term accommodations, says the province, and therefore aren’t eligible.
Travel expenses that are not for short-term accommodation or camping, like car rentals, fuel, flights, groceries, parking or paid admission for local attractions don’t qualify.
If expenses for stays were reimbursed to you, your spouse or common-law partner, or your eligible child, by someone like a friend or an employer, you won’t be eligible to claim the tax credit.
Expenses that are incurred for school or educational purposes, for a job or business opportunity, or an expense that is eligible for a medical expense tax credit don’t qualify.
How much can you claim
Ontarians can get back up to 20 per cent of their eligible 2022 accommodation expenses, for a stay at a hotel, cottage or campground when they file their personal income tax next tax season. You can claim eligible expenses up to $1,000 as a single person 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 province says the staycation credit will provide approximately $270 million to help nearly 1.85 million Ontario families.
How to claim the staycation tax 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, which means that if you’re eligible, you can get this tax credit regardless of whether you owe taxes for 2022.
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