Short-term rental operators in Toronto must register their properties with the city by the end of 2020 in order to avoid a possibly hefty fine.
On Thursday, the City of Toronto issued a reminder to property owners who rent homes or rooms for periods of less than 28 straight days to register with the city by Dec. 31.
As of Jan. 1, registered operators must start collecting a Municipal Accommodation Tax (MAT) which will be owed to the city on a quarterly basis.
“After January 1, 2021, the City will take enforcement action against operators who are not registered or are not following the rules,” city staff said in a news release issued on Thursday.
“Enforcement action will also be taken against short-term rental companies that allow unregistered operators to list on their platform or contravene the bylaw.”
Operators who don’t comply with the regulations could face a fine of up to $100,000.
Short-term rental companies also must ensure that all short-term rental listings on their platform have a valid city registration number.
In the new year, the city says it will begin sharing the registration number, the associated ward, and the first three digits of the postal code of registered short-term rental properties on its open data portal.
As the city gears up to collect MAT, city council is meeting today to discuss imposing a tax on vacant homes in Toronto.
A staff report released last week says a vacant homes tax could bring in approximately $55 to $66 million in revenue per year if set at one per cent of a home’s assessed value.
But Mayor John Tory has previously said that the purpose of the tax is to discourage owners from letting their homes sit empty.
Currently, short-term rentals are not permitted to operate in the city as Toronto and Peel Region entered a lockdown on Nov. 23 to curb the spread of COVID-19. The two hot spots will remain in lockdown until at least Dec. 21.
Despite the lockdown restrictions, the city requires short-term rental operators to register by Dec. 31 so that they can continue short-term renting when allowed to do so under provincial regulations.
Operators are only allowed to short-term rent their principal residence. This is the home where they live and the address used for bills, identification, taxes and insurance.
The city introduced the short-term rental framework in order to regulate home sharing companies like Airbnb. Critics have said that such businesses take homes that could otherwise be used for long-term housing out of the marketplace, worsening the situation for renters in a city that typically has extremely low vacancy rates.
