Any Canada taxes due on $ earned renting out a Mexican RTU week ?

[VanX]

We are able to charge $250 USD for a week of use of our Mexican Right To Use 25 year points based timeshare with unfixed dates and room classes. We can do this a number of times per year.

Wondering about any possible Canadian taxes due on the $250 sent to us for each week we allow others to use?

Any pointers to GST/HST or other earned income rules and regs for Canada would be greatly appreciated

 

[echino]

I am reporting my rentals on T2125. No GST/HST since it's outside of Canada.

However, your question looks strange. Have you actually received any income? It sounds very much like a known scam when you are promised to get paid for renting your weeks, but first you must pay a fee to them. It's not that, is it?

 

[VanX]

Oh thanks for the details and from all my readings I couldn’t find a GST/HST reference to timeshare outside of Canada.

Yes we have received funds paid to us on a per trip booked and on numerous occasions. It is arranged by us with individual travelers as an authorization communicated by us to the resort that the guest can book using our membership nights for dedicated room nights.
We control all steps and have no 3rd party involved. Travelers pay us directly in order to book using our membership with the resort membership club.

 

[VanX]

Our accountant is on the taxable income portion so no worries there but also is suggesting we should be registered for and paying GST.

 

[VanX]

UPDATED:
GST advisor deemed we do have to have a GST number assigned and because the asset is outside Canada and guests are non-residents (outside of Canada users) it’s a zero rating assigned with no GST payable, unless we have Canadians as guests.

GST is not exempt. Reasoning. Our actions are intentional to allow the right to use our intangible asset located out of Canada which allows others to book with a discount.

Amounts earned are taxable at personal income rates but we escaped the GST added cost as payable. - whew !

The one good benefit to us of Canadians not traveling in 2020.

 

[AJCts411]

To add on the HST/GST, No HST/GST is due or payable if the product (timeshare) and the invoice leave/billed out side of Canada. And a HST/GST number (registration) is not required when the gross amount of your sales is under a fixed amount. It was 35,000 at one time in the past. And added to this is the rule that GST is not charged/collected when your annual sales are under the said amount.

 

[VanX]

To add on the HST/GST, No HST/GST is due or payable if the product (timeshare) and the invoice leave/billed out side of Canada. And a HST/GST number (registration) is not required when the gross amount of your sales is under a fixed amount. It was 35,000 at one time in the past. And added to this is the rule that GST is not charged/collected when your annual sales are under the said amount.

Agreed and our amount collected in 2020 exceeded the 35K so that’s what raised the question with our accountant. All good though