Most residential property managers in Canada have questions about how GST applies to their operations. This guide explains the rules and how Propra handles GST automatically so your accounting stays accurate and compliant.
Is Residential Rent Subject to GST?
No, residential rent is GST exempt, which means;
GST is not charged to tenants
ITCs (input tax credits) for GST paid on expenses related to exempt residential properties cannot be claimed, even if an owner claims GST for other part's of their business
How to treat GST for residential properties
GST must be charged on a service or product based on Canada Revenue Agency's regulations. As a result, when charging management fees, mark ups, maintenance billing or other services to a residential property GST is added to the bill. It is required to display the GST amount and your GST number on the copy of the bill.
When recording the accounting entry for bills and expenses, the GST is rolled up into the total expense amount for residential properties. This is because the GST is part of the expense for the property and should be included for their income tax documents.
How Propra Manages GST Automatically
Propra is designed to simplify GST accounting for property managers:
For scanned bills, automatically detects and splits GST on vendor bills for commercial properties only
Ensures rent invoices follow GST-exempt rules
Generates clear statements showing GST-inclusive totals
Generates management fee, mark up and maintenance bills with GST amount listed in the owner's portal
Keeps expense records audit-ready
Reduces manual entry and errors
With Propra, you can confidently handle GST on expenses while ensuring rent remains compliant and consistent every month.
If you have questions about how this applies to your portfolio, our support team is always here to help.