What is the Ontario staycation tax credit?

With the Ontario Staycation Tax Credit, the Ontario government is encouraging residents to rediscover the province and support the province’s crucial tourist economy for the 2022 calendar year. When completing your personal income tax and benefit return for 2022, Ontario individuals can claim 20% of their qualified lodging costs. This may include a stay at a hotel, cottage, or campsite. Individually, you can claim up to $1000 in qualifying costs, or $2000 if you have a spouse, common-law partner, or eligible children, for a total refund of up to $200 for an individual or $400 for a family.

Who is eligible?

You are eligible for this credit if you are an Ontario resident on December 31, 2022. Only one person per household is eligible for the credit each year. The qualifying costs of your spouse or common-law partner, as well as your eligible children, can be included in your claim. If you don’t have a spouse, common-law partner, or eligible child, you can still claim the credit for your own qualified expenses. 

Eligible Expenses

The Ontario Staycation Tax Credit encompasses accommodation expenses for leisure stays of less than a month in Ontario. The tax credit is only valid for stays between January 1, 2022, and December 31, 2022, regardless of the timing of payment for the stays. The accommodation expense must have been paid for by you, your spouse, or common-law partner, or your eligible child.

Accommodations include hotels, motels, resorts, lodges, cottages, bed-and-breakfast establishments, campgrounds, and vacation rental properties. To validate these expenses during tax season, keep your detailed receipt to claim the credit. The receipt must include:

  • Location of the accommodation 
  • The dollar amount for the accommodation portion of a stay
  • The amount of any/ paid GST, HST
  • The date of the stay 
  • Name of the payor 

Ineligible expenses

The Ontario Staycation Tax Credit does not include a timeshare agreement, a stay on a boat, train, or other vehicles that can be self-propelled. The tax credit cannot be claimed for:

  • Expenses for car rentals, fuel, flights, groceries, parking, or prices of admission into local attractions and places of interest.
  • Accommodation expenses reimbursed to you
  • 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.

The scope of the Ontario Staycation Tax credit is to make travel more accessible and invite Ontarians to explore the province. The tax credit will help individuals and families save on local trips while also reviving local tourist industries. The goal is to keep Ontario competitive in the global market. The Ontario Staycation Tax Credit is estimated to provide $270 million in support as part of the 2021 Ontario Economic Outlook and Fiscal Review: Build Ontario. The tax credit is also expected to provide support to about 1.85 million Ontario families. If you’re looking to use this benefit for your next getaway be sure to check if you are eligible and what expenses qualify to begin planning your local trip today. 

 

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