As the COVID-19 pandemic continues to impact travel plans, many Canadians are opting for staycations to enjoy some downtime closer to home. To encourage this, the Ontario government introduced a Staycation Tax Credit for Ontario residents in 2021. If you’re a resident of Ontario and planning a staycation, here’s everything you need to know about the Ontario Staycation Tax Credit.
What is the Ontario Staycation Tax Credit?
The Ontario Staycation Tax Credit is a non-refundable tax credit that allows eligible Ontario residents to claim a 20% tax credit on eligible expenses of up to $1,000 per individual or up to $2,000 per family (two or more individuals) for eligible expenses paid for a staycation in Ontario between June 1 and December 31, 2021.
Who is eligible for the Ontario Staycation Tax Credit?
To be eligible for the Ontario Staycation Tax Credit, you must meet the following criteria:
- Be a resident of Ontario on December 31, 2021
- Have paid for eligible expenses for a staycation in Ontario between June 1 and December 31, 2021
- Be 18 years of age or older on the last day of the taxation year
- Have a total income of less than $150,000 for the taxation year
- Have a valid social insurance number
What expenses are eligible for the Ontario Staycation Tax Credit?
Eligible expenses for the Ontario Staycation Tax Credit include:
- Accommodation fees (e.g. hotels, motels, bed and breakfasts)
- Food and beverages (excluding alcohol)
- Admission fees to tourist attractions
- Tours and guide services
- Equipment rentals for outdoor activities (e.g. bikes, kayaks, canoes)
- Vehicle rentals (e.g. cars, RVs) for use within Ontario
Expenses that are not eligible for the tax credit include:
- Alcohol purchases
- Vehicle rentals for use outside of Ontario
- Expenses that are reimbursed by an employer or other party
- Expenses claimed for any other federal or provincial tax credit
How to claim the Ontario Staycation Tax Credit?
To claim the Ontario Staycation Tax Credit, you must file your 2021 personal income tax return and complete Schedule ON(S12) – Ontario Non-Refundable Tax Credits. You will need to provide receipts or invoices to support your claim for eligible expenses.
Final Thoughts
The Ontario Staycation Tax Credit is a great way for Ontario residents to save money on their staycation expenses and support local tourism businesses. By taking advantage of this tax credit, you can enjoy a much-needed break while also helping to boost the Ontario economy. Just make sure to keep all receipts and invoices for your eligible expenses, and consult a tax professional if you have any questions about claiming the credit.