weener

Hi

Just a idea which we have been playing with. When we visited Ontario (around the GTA and south) we stayed at a few B&B's and were informed you can earn up to $30k without paying tax on this? Is this true?.

Also, what are the laws on having tenants?. When looking at houses on MLS some already have tenants which is something I will contemplate if if helps with the bills..... Just after some thoughts really.

KennyJosie

Hi Weener,
I'm sorry i can't help you with the tax thingy, but as for tenants, you might get some info here!
http://www.orht.gov.on.ca/userfiles/..._3_7968_1.html

However, when i was looking at properties, I tended to steer away from existing tenants. My thinking was;
1) Why are the existing owners selling if they have an income from the tenants? (Are the tenants difficult, poor payers etc?)
2) I would wish to compare them to my own criteria before offering them the house. (Do they "fit in" with the rest of the inhabitants / neighbours etc? What length of tenancy do they want compared to what you want? etc.)
I would much prefer to choose my own tenants, that way you can have someone who "blends in", and if they are poor tenants then I can only blame myself!
I hope this gives you food for thought!
Kenny

weener

Hi Kenny

I agree, but haven't thought of it like that. Thanks for the "food for thought"

yonk

I would be happy to take on existing tenants, so long as I had thoroughly checked out the reasons the existing l/l is selling. Make sure you understand all the costs involved, maintenance, property taxes, etc.

You, apparently, have to watch for "grow-ops" as it wrecks the house beyond repair....

B & B's for sale on

http://www.bbcanada.com/bb_forsale.cfm

Good luck!

J.

Judy in Calgary

As far as I know it is not true. What is true is that yuo can earn $30,000 without having to remit GST (federal goods and services tax). My understanding is that you still have to pay income tax (albeit you'd be able to claim B&B related expenses against B&B income). In addition to that, depending on the province, you might have to collect and remit PST (provincial sales tax).

Here is a website about operating a B&B that is provided by the government of Prince Edward Island. Obviously some of the information (e.g., on PST) is specific to PEI, but it also seems to give very good overall information about operating a B&B.

I have never run a B&B, so I can't talk about it from personal experience. We have an acquaintance who runs one in Calgary. She is a former nurse who turned to running a B&B when she got divorced and found herself raising three young kids as a single mother. The advantage of operating a B&B is that it allowed her to be home when her kids got back from school. Now her kids are in their twenties and thirties, and that factor isn't relevant anymore. However, she has built up a good clientele, so she keeps going. It seems to me that running a B&B is hard work and more time consuming than first meets the eye. Whenever our acquaintance has come to our house for dinner, she has had her cell phone (mobile) with her, and she has received several calls from people enquiring if she has a vacancy.

Yoong

Another option to consider is having homestay students.
There are students from foreign countries that want to learn
English and experience Canadian homelife.They pay well,easier to
manage because they have an agent to liase between the students
and the homestay parents.Sure, there are problem ones, the agent rematch
them with another family. I have friends that are doing well with
homestay venture. Hope that helps, Yoong

weener

Thanks for all the replies. Its just a idea were playing with, just incase we don't fall straight into work...