We own a cottage that we AirBnb part of the time. Do I claim all expenses, partial expenses to the amount of time available, or expenses equivalent to the time rented?

[fantasticfinley]

We purchased this cottage in 2021, so we had additional maintenance, such as refinishing cedar siding and installing a water filtration system.  These expenses won't be every year.  Trying to figure out how much I can claim.

[TurboTaxSusan]

You can only claim expenses that you incurred to earn rental income – no personal expenses. If an expense is both personal and business-related, you can only claim the portion of the expense that relates to your rental. For example, if you want to claim utilities, you can only claim the amount that you spent when the cottage was rented out.

There are two kinds of expenses – capital and current. A current expense is an amount you spend to upkeep your property, like maintenance. Generally, you can claim current expenses in the year that you incurred them. The refinishing of your siding is likely a current expense.

A capital expense is something that improves your property. Depending on the cost, you may want to take capital cost allowance (CCA) for these expenses. This allows you to deduct a portion of the expense over several years. You may be able to take CCA on your water filtration system if you didn’t have one previously, and the cost was substantial.

Please see these Canada Revenue Agency (CRA) pages for more information on expenses:

Current expenses or capital expenses

Capital cost allowance (CCA) for rental property

[Tweetynae25]

In the eyes of the Canada Revenue Agency, any income earned by renting out your home or other property is considered to be rental income – even if it’s just for a night or two, every once in a while.  Like other types of income, the money you make from your rental must be reported to the government as income on your personal income tax return.  Before you have any second thoughts, keep in the mind the good news, that since you’re reporting the income, you are also able to deduct expenses related to that income.

By visiting our TurboTax article Earning & Reporting Income From Airbnb you will find the information for your answer.

• Eligible Expenses: From Pillows to Property Taxes

• How Much is Eligible to Deduct?

• Eligible Expenses: From Pillows to Property Taxes

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