City of Toronto cracks down on Airbnb-type rentals with new rules and mandatory registration

After a process to approve the regulation of short-term rentals was initiated by Toronto City Council in December 2017, the Licensing and Registration Of Short-Term Rentals  bylaw was approved on November 18, 2019 after Toronto won a hearing Local Planning Appeal Tribunal (LPAT). The City will now move forward with the implementation of the bylaw, as adopted by City Council.

Key details of the new rules laid out by the new City Short-Term Rental zoning bylaw are as follows:

• Short-term rentals are permitted across the city in all housing types in residential and the residential component of mixed-use zones.
• People can host short-term rentals in their principal residence only – both homeowners and tenants can participate.
• People can rent up to three bedrooms in a unit for an unlimited number of nights per year (up to a maximum of 28 days per stay) or their entire home for a maximum of 180 nights per year.
• People who live in secondary suites and laneway suites can also participate, as long as the secondary suite/laneway suite is their principal residence.

Once the licence and registration system is ready, short-term rental companies will be required to obtain a licence and operators will be required to register with the City and pay the Municipal Accommodation Tax (MAT) of four per cent.

The City is planning to implement the regulations for short-term rentals in phases. New online registration, licensing and enforcement systems are being put in place.

The first phase is already ongoing. “As the licensing and registration system is being put in place, the City continues to respond to issues on a complaint basis. Residents can contact 311 to report issues related to short-term rentals, such as noise, waste and zoning infractions and the City will investigate accordingly,” it says on the City of Toronto website.

The second phase is Licensing and Registration which goes into effect this Spring with details on exact dates to come. According to the City of Toronto website, “During this phase current and prospective short-term rental operators will have three months to register. During this time, the City will educate the public on short-term rental rules, encourage operators to register their short-term rentals, and work with companies to ensure compliance with the licensing rules. These rules state that Applicants will be required to pay a one-time licence application fee of $5,000 and an ongoing fee of $1.00 for every night booked through the company.”

Phase 3, which begins in the summer of 2020 is the implementation of Enforcement and Municipal Accommodation Tax (MAT). The rules on the website state, “All current short-term rental operators will need to be registered by the end of phase 2 and failure to register or follow the rules will result in the City taking enforcement actions against offending short-term rental operators. As of the end of phase 2, registered short-term rental operators will also be required to start paying the four per cent Municipal Accommodation Tax (MAT) on a quarterly basis.”

Enforcement action will also be taken against companies that allow unregistered operators to list on their platform or contravene the bylaw.

New short-term rental operators can register on an ongoing basis.

The process of creating the updated Short-Term Rentals zoning bylaw amendments came after the City of Toronto won a hearing at the Local Planning Appeal Tribunal (LPAT) in November. At the tribunal, Airbnb landlords were attempting thwart the city’s amendments, which council approved in 2017.

For complete details on all the new Short-Term rentals rules you can find them at https://www.toronto.ca.